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35 IELR 245 (2019)
Transnational Corruption and Transparency

handle is hein.journals/ielr35 and id is 259 raw text is: INTERNATIONAL ENFORCEMENT LAW REPORTER - Volume 35, Issue 7 that the extradition treaty between the two countries.4 After a review of the case, the Department of State issued a warrant ordering Arias's surrender to Colombian authorities. On July 12, the U.S. Marshals Service executed that warrant, transported Arias to Colombia, and delivered him to the custody of Colombian authorities. Arias's extradition is now complete.5 David Oscar Markus, counsel for Arias, said he was the victim of a sham, political, and meritless prosecution and he was disappointed that the court of appeals deferred to the U.S. State Department, even though everyone knows no extradition treaty is in effect between the two countries.6 Periodically Colombian courts and the executive branch have taken the position that the extradition treaty between the U.S. and Colombia is not in effect. The speed with which the United States government returned Arias after the court of appeals affirmed his extraditability shows the U.S. government was quick to affirm the treaty and show it is keen to implement the same. 4 Id 5 Id 6 Michael Balsamo, US extradtes former Colombian agriculture minister, WASH. POST, july 12, 2019. III. TRANSNATIONAL CORRUPTION AND TRANSPARENCY Walmart Inc. and Brazilian Subsidiary Agree to Pay $137 Million and Sub Pleads Guilty to FCPA Violations By Bruce Zagaris On June 20, 2019, Walmart Inc. (Walmart), a U.S.-based multinational retailer and its wholly owned Brazilian subsidiary, WMT Brasilia S.A.R.L. (WMT Brasilia), settled Foreign Corrupt Practices Act (FCPA) charges by agreeing to pay a combined criminal penalty of $137 million and a guilty plea by WMT Brasilia to end a seven-year inquiry.' Walmart admitted that, from 2000 until 2011, certain Walmart personnel responsible for implementing and maintaining the company's internal accounting controls related to anti- corruption were aware of certain failures involving these controls, including relating to potentially improper payments to government officials in certain Walmart foreign subsidiaries, but still failed to implement adequate controls. Such controls would have, among other things, ensured: (a) that adequate anti-corruption related due diligence was conducted on all third-party intermediaries (TPIs) who interacted with foreign officials; (b) that sufficient anti- corruption-related internal accounting controls concerning payments to TPIs existed; (c) that proof was required that TPIs had performed services before Walmart paid them; (d) that TPIs had written contracts U.S. Department ofjustice, Walmart Inc. and Bragjl-Based Subsid/ay Agree to Pay $137Million to Resolve Foreign Corrupt Practices Act Case, June 20, 2019. that included anti-corruption clauses; (e) that donations ostensibly made to foreign government agencies were not converted to personal use by foreign officials; and (f) that policies concerning gifts, travel and entertainment sufficiently addressed giving things of value to foreign officials and were implemented. Although senior Walmart officials responsible for implementing and maintaining the company's internal accounting controls related to anti- corruption knew of these issues, Walmart did not start to change its internal accounting controls related to anti-corruption to comply with U.S. criminal laws until 2011.2 Internal controls failures permitted Walmart foreign subsidiaries in Mexico, India, Brazil, and China to hire TPIs without establishing adequate controls to prevent those TPIs from making improper payments to government officials in order to secure store permits and licenses. In many cases, inadequacies in Walmart's anti-corruption related internal account controls in these foreign subsidiaries were reported to senior Walmart employees and executives. The internal control failures permitted the foreign subsidiaries in Mexico, India, Brazil, and China to open stores faster than they would have with sufficient internal accounting controls related to anti-corruption. As a result, Walmart earned additional profits through these subsidiaries by opening some of its stores more rapidly.3 In Mexico, a former attorney for Walmart's local subsidiary reported to Walmart in 2005 that he had overseen a scheme for several years prior in which TPIs made improper payments to government officials to secure permits and licenses for the subsidiary and that several executives at the subsidiary knew of and approved of the scheme. Most of the TPI invoices included a 2 Non-Prosecution Agreement, Statement of Facts, paragr. 20. Id, paragr. 25. 245

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