Saturday, March 26, 2005
Thomas Coughlin, vice-chairman of Wal-Mart and one of the last remaining executives and board members from the reign of company founder Sam Walton, was forced to resign because of problems regarding the reimbursement of expenses. The company filed an 8-K (here) with the SEC stating:
The Company’s request for Mr. Coughlin’s resignation arose from a disagreement between Mr. Coughlin and the Company concerning the results of a recent internal investigation into the alleged unauthorized use of corporate-owned gift cards and personal reimbursements that appear to have been obtained from the Company through the reporting of false information on third-party invoices and Company expense reports. The amount in controversy is estimated to be in the range of $100,000 to $500,000.
Based on the results of the Company’s internal investigation, including Mr. Coughlin’s response to questions concerning his knowledge of certain transactions, the Company promptly reported the results of its investigation to the United States Attorney for the Western District of Arkansas and requested that all appropriate action be taken with respect to the reported matters. The Company thereafter provided the results of its investigation to federal officials and is cooperating with them in connection with their further review of these matters.
Coughlin's 2004 salary was just under $1 million, he received a large block of stock options, and just last month sold 45,000 shares of Wal-Mart for gross proceeds of $2.3 million (Form 4 here); he still owns approximately 346,000 shares (with a value over $17 million). Why would anyone risk their career over such a comparatively small amount (less than $500,000)? (ph)