Checking In On Wal-Mart
In today’s 3Q FY2018 earnings call presentation and related transcript, Wal-Mart disclosed that “discussions with the government agencies in the FCPA matter have progressed to the point that the company recorded an accrual of $283 million, or $0.09 per share … regarding the possible resolution of the FCPA matter.”
Against the backdrop of certain commentators using the “b” word (as in billions), I predicted from the start, guided by FCPAnalytics, that Wal-Mart’s Foreign Corrupt Practices Act enforcement action was unlikely to be a top five FCPA settlement amount of all-time. If the $283 million amount holds, the Wal-Mart enforcement action will not even be in the top ten FCPA settlements of all-time.
Jay Jorgensen On Walmart’s Enhanced Ethics & Compliance Program
Recently Jay Jorgensen (Walmart Executive V.P. and Global Chief Ethics and Compliance Officer) delivered a keynote address at The FCPA at 40 symposium hosted by Texas A&M University School of Law on October 12th.
Portions of Jorgensen’s address are published below with permission. Jorgensen’s entire keynote address will be published in a forthcoming issue of the Texas A&M Law Review. In the excerpted portion, Jorgensen talks about the transformation of Walmart’s ethics and compliance program with a focus on anti-corruption. Specifically, Jorgensen discusses Walmart’s approach to: third-party due diligence and payments; licenses and permits; donations and charitable contributions; financial controls; and enhanced training.
Checking In On Wal-Mart’s Pre-Enforcement Action Professional Fees And Compliance Enhancements
In its recent 2Q FY2018 earnings call presentation Wal-Mart disclosed $12 million in Foreign Corrupt Practices Act and compliance related expenses ($7 million for ongoing investigations and inquiries and $5 million for global compliance program and organizational enhancements). The Q2 expenses of $12 million compare to the following recent quarterly expenses (Q1 FY2018 $16 million; Q4 FY2017 $17 million; Q3 FY2017 $29 million; Q2 FY 2017 $28 million, and Q1 FY2017 $25 million).
Doing the math, Wal-Mart’s 2Q FY2018 FCPA and compliance-related costs is approximately $195,000 per working day.
Over the past 5 years, I have tracked Wal-Mart’s quarterly disclosed pre-enforcement action professional fees and expenses. While some pundits ridiculed me for doing so, it quickly caught on as the popular thing to do.
Much Ado About…Little?
I didn’t come up with the headline, but I did participate in an extensive Q&A about Walmart’s FCPA scrutiny with Metropolitan Corporate Counsel. The Q&A was published in its most recent issue with the headline: “Much Ado About…Little? How a ‘garden variety’ FCPA investigation of Walmart grabbed the spotlight.”
The Q&A is republished below with permission.
Checking In On Wal-Mart’s Pre-Enforcement Action Professional Fees And Compliance Enhancements
In its recent 1Q FY2018 earnings call presentation Wal-Mart disclosed $16 million in Foreign Corrupt Practices Act and compliance related expenses ($13 million for ongoing investigations and inquiries and $3 million for global compliance program and organizational enhancements). The Q1 expenses of $16 million compare to the following quarterly expenses in FY2017 (Q4 $17 million, Q3 $29 million, Q2 $ 28 million, Q1 $25 million).
Doing the math, Wal-Mart’s 1Q FY2018 FCPA and compliance-related costs is approximately $260,000 per working day.
Over the past 5 years, I have tracked Wal-Mart’s quarterly disclosed pre-enforcement action professional fees and expenses. While some pundits ridiculed me for doing so, it quickly caught on as the popular thing to do.