US-based multinational retail giant Wal-Mart Stores Inc. is suspected to have paid massive amounts as bribe in India to obtain regulatory permits for some of its operations, according to a media report.
Walmart is suspected to have paid "thousands of small payments" to junior-level officials in India in order to pass its goods through customs or get real estate approvals, the Wall Street Journal reported.
"The vast majority of the suspicious payments were less than $200, and some were as low as $5, the people said, but when added together they totalled millions of dollars," the report said.
Walmart decided to put aside its plans to foray into Indian market in 2013 by discontinuing its joint venture with Bharti Enterprises Ltd. After that, the company opted to go alone in India.
"Walmart was also involved in lobbying before the US Congress in this regard," the report said, citing Congressional disclosure reports of the past few years.
However, Walmart's bribe may not attract heavy penalty in the US, as its operations in India do not bring any profits to the company under the provisions of the Foreign Corrupt Practices Act (FCPA) of the US. "Because penalties under the FCPA are often connected to the amount of profit the alleged misconduct generated, the payments in India wouldn't be likely to result in any sizable penalty, since Wal-Mart's operations there haven't been particularly profitable, said people familiar with the matter," the daily said.
The report said that federal investigators "found evidence of bribery in India, centering on widespread but relatively small payments made to local officials there."