It’s common knowledge that the FCPA investigations are costing Walmart a fortune. WMTS has previously documented the figure. What’s not known is when it will all end.
EVP and Corporate Secretary Jeffrey Gearhart shed a bit of light on this question recently in a give and take with a Wall Street analyst. After indicating that the investigation will continue for the rest of the year, he didn’t offer an opinion as to what would happen beyond this year saying, “Hard to know…we don’t have a lot of control over that, and our view is we’ll continue to fully cooperate with the government, and it’ll take as long as it’ll take.”
So where’s the nearly quarter of a billion dollars spent on the investigation gone? Well, a bunch has gone to outside firms. Another tidbit from Gearhart: “To date, we’ve had over 300 third-party legal and accounting experts who’ve dedicated in excess of 100,000 hours to [the investigation]. “ And an Indian newspaper reported that 20 outside lawyers from Greenberg Traurig have decamped to India, and that Greenberg Traurig and consulting firm KPMG have so far billed for 26,000 hours of work related to Walmart in India.
And that’s just India. It’s unfortunate that company leaders didn’t put in place systems to prevent these problems at the outset of overseas expansion rather than having to create a robust compliance program after the fact. It certainly would have been cheaper.