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2006-08-13
Fort Smith, AR. Wal-Mart's Coughlingate

Tom Coughlin, the former Vice Chairman of Wal-Mart's board of directors, and the man often at CEO Lee Scott's right hand during the company's Saturday Morning Meeting, was sentenced this week to two years and three months of "house arrest." That's a far sight better than 28 years in jail, which the former number #2 man at Wal-Mart reportedly could have received. Coughlin is famous here at Sprawl-Busters for having coined the phrase, "At Wal-Mart we make dust, our competitors eat dust." This week, it was Coughlin who ate dust -- but from the comfort of his own living room, surrounded by his home entertainment system and loving family. Coughlin's doctor managed to dodge a jail term for his client by arguing that the former executive and multi-millionaire was "too sick to serve in prison." Coughlin's doctor said the 57 year old Coughlin suffers from hypertension, diabetes, and sleep apnea, and that putting him in jail would have been "life-threatening." US District Judge Robert Dawson agreed, and punished Coughlin with home detention, the legal equivalent of a slap on the knuckles. The Judge reportedly said Coughlin was an "exemplary citizen" before his "spectacular fall." So the Judge made sure that Coughlin did not "fall" too hard. Even the prosecutors in this case were only asking for a six month's sentence. As one newspaper pointed out in its story, Coughlin, who was once in charge of "loss prevention" at Wal-Mart (preventing theft) has now been found guilty of stealing from his company. Media reports in 2005 suggested that Coughlin used company funds to engage in anti-union activities. Coughlin reportedly used the money to pay union members who agreed to identify pro-union Wal-Mart workers. But the company denies that money was used to pay off union spies. US Attorney Robert Balfe told reporters the investigation had found no evidence backing Coughlin's earlier claims that the money he took was reimbursement for unspecified anti-union activities. Yet after his sentencing, Coughlin read a statement that hinted at some "activity" that went beyond buying cowboy boots. Coughlin's statement said, in part, ""It is obvious that the activity that I was involved in had gone on for a number of years and was in fact acknowledged by members of management even though they did not know the specific details." During his jury trial, Coughlin admitted defrauding the company to pay for the care of his hunting dogs, lease a private hunting area, upgrade his pickup truck, buy snakeskin cowboy boots, liquor and a cooler, and receive $3,100 in cash. The items were worth a total of $14,395. Coughlin left Wal-Mart's board in March, 2005, just as the company was notifying the Securities and Exchange commission that it was providing documents to federal investigators. Instead of serving time, Coughlin is free to serve drinks at home, as long as he pays off his $50,000 fine, and makes $411,000 in restitution to Wal-Mart and the IRS. As vice chairman of Wal-Mart, Coughlin was paid a salary of $1.03 million, plus $3 million in bonuses and other income. He reportedly owns at least $20 million in Wal-Mart stock.


What you can do: "There is no excuse for my conduct," Coughlin admitted during the hearing. Wal-Mart responded to the 'no jail' sentence by saying, "Our company's actions through-out this process have been consistent with our core values and the principle that all associates are held accountable to the same standard, regardless of their position." But it appears that the legal system in Arkansas uses different standards for criminals depending on their position. There are, no doubt, many souls languishing in Arkansas jails who would have preferred to get a sentence of home detention. But 5 counts of wire fraud and 1 count of filing a false tax return apparently results in a different standard in Arkansas. The case goes to prove once again, as the Bob Dylan song goes, that "the ladder of law has no top and no bottom...and that even the nobles get properly handled." Wal-Mart must be glad this embarrassment to its "core values" will soon fade from the headlines, and that one of its fallen core members will go about the rest of his life in the comfort of his own home. For earlier stories, search Newsflash by "Coughlin." Dust to dust.










 
 
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