Kevin Abikoff was quoted in a story in Women’s Wear Daily regarding the legal issues companies face when developing businesses overseas.
In the June 13, 2012 article, headlined “Firms Battle Dangers of Overseas Markets,” Abikoff discussed the US and Mexican probes into allegations that Wal-Mart covered up the findings of an internal investigation in 2005 that revealed its Mexican subsidiary bribed officials in that country as part of a scheme to accelerate the company’s rapid expansion there.
“Where does an aggressive culture to make the bottom line and increase profits become a culture that passively encourages corruption or inappropriate bookkeeping and fraudulent statements?” Abikoff asked. “It’s a fine line. We all want to invest in companies that are aggressive in cost cutting, but you have to be aggressive within the law.”
Abikoff said the scope of the damage to Wal-Mart will depend on whether the investigation determines that the alleged corruption was an isolated incident by a rogue employee, or a systematic failure of a corrupt culture or a culture that didn’t have the proper controls in place.
“Something off happened in Mexico,” he said. “People didn’t pay enough attention to it at the outset when it should have been looked at and taken seriously.”