The Wall Street Journal reports this morning that Wal-Mart is defending itself in the probe into its use of illegal immigrants to clean the floors of some of its stores by saying that the company's managers not only knew of the probe before a series of October 23 raids, but in fact were cooperating with the government.
The WSJ reports, "Wal-Mart says it was led to believe it wasn't a target of the investigations, and it says it didn't take action to sever its ties with the contractors because federal officials specifically asked it to leave the relationships in place."
Wal-Mart spokesman Mona Williams told the WSJ that for three years, the company cooperated with federal agents. "Throughout that time they specifically told us we were not the target of any investigation and that we would be given a heads-up before any arrests were made in our stores. Instead, they conducted unannounced raids on our stores and created a well-planned media frenzy by saying they had proof that Wal-Mart executives knew what was going on. All we knew was what they had told us."
Sources tell the WSJ, however, that the government probably moved against Wal-Mart because it believed the retailer wasn't being cooperative enough, which is why it engaged in unannounced raids on 61 stores back in October, arresting several hundred illegal immigrants who were cleaning floors at the stores, though they actually were employed by an outside contractor.
A Pennsylvania grand jury currently is looking into the relationship between Wal-Mart and its cleaning contractors and sub-contractors.
Wal-Mart's defense up to this point has been that it did not know that the cleaning crews had illegal immigrants on them, and therefore cannot be held responsible for them - though clearly the new defense tactic suggests that this is not entirely accurate.
Critics of Wal-Mart have suggested that the company needs to be held responsible because one of the way it maintains low prices and low costs is by having a "wink and a smile" relationship with contractors who are behaving in an illegal fashion - though of course, this has not been proven.
The WSJ reports, "Wal-Mart says it was led to believe it wasn't a target of the investigations, and it says it didn't take action to sever its ties with the contractors because federal officials specifically asked it to leave the relationships in place."
Wal-Mart spokesman Mona Williams told the WSJ that for three years, the company cooperated with federal agents. "Throughout that time they specifically told us we were not the target of any investigation and that we would be given a heads-up before any arrests were made in our stores. Instead, they conducted unannounced raids on our stores and created a well-planned media frenzy by saying they had proof that Wal-Mart executives knew what was going on. All we knew was what they had told us."
Sources tell the WSJ, however, that the government probably moved against Wal-Mart because it believed the retailer wasn't being cooperative enough, which is why it engaged in unannounced raids on 61 stores back in October, arresting several hundred illegal immigrants who were cleaning floors at the stores, though they actually were employed by an outside contractor.
A Pennsylvania grand jury currently is looking into the relationship between Wal-Mart and its cleaning contractors and sub-contractors.
Wal-Mart's defense up to this point has been that it did not know that the cleaning crews had illegal immigrants on them, and therefore cannot be held responsible for them - though clearly the new defense tactic suggests that this is not entirely accurate.
Critics of Wal-Mart have suggested that the company needs to be held responsible because one of the way it maintains low prices and low costs is by having a "wink and a smile" relationship with contractors who are behaving in an illegal fashion - though of course, this has not been proven.
- KC's View:
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It is hard to comment intelligently on this case, simply because we don't know what proof is being laid out before the grand jury. And these issues are so convoluted that they are difficult to make sense of without all the information.
But it just feels like the messiness hasn't been completely exposed yet.
