Wal-Mart Probed on Hazardous Materials
The U.S. attorney’s office in Los Angeles is conducting a criminal investigation into Wal-Mart Stores Inc.’s handling of merchandise classified as hazardous waste.
The world’s largest retailer said in a regulatory filing that prosecutors were probing potential violations of the federal Resource Conservation and Recovery Act, which regulates the transportation, handling and disposal of waste.
The investigation involves merchandise returned to California stores and trucked to the company’s return center in Las Vegas.
Wal-Mart previously reported that it had received a grand jury subpoena from the U.S. attorney seeking documents and information relating to the company’s handling of merchandise that contained hazardous materials. Such products could include perfumes, aerosols, nail polish, plant food and cleaning solvents, among other things.
The California Department of Toxic Substances Control requested similar documents, the company said, and other state and local officials in California and Nevada have launched investigations.
In a statement Tuesday, a Wal-Mart spokeswoman said the company believed it had complied with all state and federal environmental regulations.
“We are once again reviewing our transportation procedures, taking the necessary action to correct any regulatory problems, and fully cooperating with federal and state officials in California,†Wal-Mart spokeswoman Sarah Clark said.
The U.S. attorney’s office declined to comment. Wal-Mart disclosed the investigation in a filing Monday with the Securities and Exchange Commission.
A spokeswoman for Toxic Substances Control said the agency was assisting federal authorities in the investigation into the allegedly improper transportation of hazardous materials from California to Nevada.
“They are not registered with the state of California to handle or transport any hazardous wastes,†spokeswoman Jeanne Garcia said. “They are not supposed to be dealing with hazardous wastes at all.â€
An official familiar with the state probe, who spoke on condition of anonymity because of the ongoing investigation, said regulators were looking into several potential violations of California law, including whether Wal-Mart had been using employees not trained in the proper handling of hazardous materials to load, unload and transport potentially dangerous products.
The state is also examining whether Wal-Mart has kept proper records of the hazardous materials it keeps in stores and transports on California roads and freeways, the official said.
“What if they were to get into an accident?†the official asked.
In its SEC filing, Wal-Mart said the company historically had consolidated certain returned merchandise at its return centers and then taken hazardous waste products to a certified waste disposal facility.
Cindy Anderson, a spokeswoman for the Nevada Division of Environmental Protection, said the Las Vegas return center was permitted to dispose of hazardous waste generated there, but wasn’t allowed to take such material from elsewhere.
The Nevada investigation stems from unspecified “compliance issues†discovered during the last inspection of the facility, Anderson said.
Although the types of returned merchandise that might be considered hazardous waste might seem relatively benign, an environmental lawyer said regular household products could still be extremely dangerous, especially when mixed, damaged or exposed to pressure or heat.
“It’s a legitimate concern, that’s why the law exists,†said Pat Gallagher, legal director of the Sierra Club. “If there’s a car crash and stuff spills on the street, responders need to know what it is so not to create a dangerous fire or pollution situation.â€
And because federal authorities have the option of resolving such complaints informally or by filing a civil complaint, the fact that they are proceeding with a criminal investigation suggests that they consider it to be a fairly serious matter, Gallagher said.
Wal-Mart in August agreed to pay a $1.2-million settlement with the Connecticut Department of Environmental Protection for alleged violations in that state.
In 2004, Wal-Mart paid $3.1 million in fines to settle allegations that it violated the federal Clean Water Act in nine states, the largest civil penalty ever collected in a storm-water runoff matter.
In 2001, the company paid $1 million to settle claims that it illegally discharged water at construction sites in four states.
Wal-Mart shares fell 36 cents to $48.60 on Tuesday.
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