Watchdog urges Mexico to probe Wal-Mart's alleged bribery campaign raised in New York Times report

(AP) MEXICO CITY - Mexico's federal government should investigate allegations of a vast bribery campaign by top executives of Wal-Mart's Mexican subsidiary to build stores across the country, the head of a watchdog group said Sunday.

Eduardo Bohorquez, director of Transparencia Mexicana, said international conventions obligate Mexico's government to get involved even though only local officials have been linked to the scandal.

"The laws in Mexico and the United States relating to bribery are in effect, so the practices (of legal business) should be the same in both countries," he said.

Government officials declined on Sunday to comment on the allegations contained in a New York Times report that said Wal-Mart Stores Inc. failed to notify law enforcement after its own investigators found evidence that millions of dollars in bribes had been paid in Mexico to spur the company's rapid expansion there.

Report: Wal-Mart hushed up bribe network in Mexico

In 2004, activist groups unsuccessfully sought to block Wal-Mart from building one of its discount Bodega Aurrera stores near the Teotihuacan pyramid site outside Mexico City, and one of the protest leaders charged Sunday that the permit process was rigged.

"Wal-Mart started building without permits, the licenses came later," said Emma Ortega Moreno of the Civic Front for the Defense of the Teotihuacan Valley. "When there are banknotes, you know that they can work wonders. It's said that magicians don't exist, but in that sense, yes, there are magicians."

A lawyer for Wal-Mart de Mexico, Juan Manuel Torres Landa, said the company had no comment on any of the allegations.

Jose Luis Manjarrez, spokesman for the federal Attorney General's Office, said the agency had conducted no investigations on such matters and had no other comment.

One of every five Wal-Mart stores now is in Mexico and it is the country's largest private employer, with 209,000 employees.

The Times said Wal-Mart shut down its internal investigation despite a report by the company's lead investigator that Mexican and U.S. laws likely were violated by executives of Wal-Mart de Mexico, its biggest foreign subsidiary.

In recent years, the U.S. government has stepped up enforcement of the 1977 Foreign Corrupt Practices Act, which bars U.S. companies from bribing foreign government officials or companies to secure or retain business.

Numerous corporations have been ensnared by the law, including Johnson & Johnson, which agreed last year to pay $70 million to settle charges that it bribed doctors in Europe and paid kickbacks to the Iraqi government.

Avon Products Inc. fired its vice chairman in January as part of a long-running probe into allegations that bribes were paid in China. A former chief executive of engineering and construction firm KBR Inc. was sentenced to 2 1/2 years in prison in February for bribing officials in Nigeria to win contracts.

Last month, Mexican authorities announced that they were investigating allegations that a U.S. aviation company paid bribes to secure contracts to maintain government aircraft.

Mexico's Attorney General's Office said the probe involved six officials at two federal agencies and two state governments who allegedly took bribes from Oklahoma-based BizJet International Sales and Support Inc. in exchange of work contracts. Prosecutors said the case involved about $2 million in bribes for contracts worth at least $24 million.

The office gave no other details, but the U.S. Department of Justice said BizJet had agreed to pay an $11.8 million fine to settle allegations its employees bribed government officials in Mexico and Panama to secure maintenance contracts.