Community groups and organizers have accused Walmart of using charitable donations to try and buy support for the company. They claim that the Walmart Foundation has been increasing the value of their donations in areas in which they wish to build stores, and targeting charitable organizations that will improve public perception of the company and which won’t call them out for their actions.
The Walmart Foundation denies this, and the IRS has not decided to investigate them yet, but the evidence of some potentially shady dealings has been mounting. For example, back in 2008 to 2009, the Foundation donated about $200,000 to charities in Los Angeles. In 2011, as Walmart was trying to open a store there, their donations jumped up to about $1.3 million. Then, by 2013, after the store was built, they dropped back down to a mere $230,000.
It’s not just Los Angeles either. Walmart seems to be trying to buy its way into New York City as well, by ratcheting up donations to charitable organizations there. In 2009 the Foundation donated $90,000 to NYC charities, which jumped up to $1.5 million in 2010, then $6.5 million in 2011. Through this increase, it was widely known that Walmart wanted to open a store in the city, which was met with increasing resistance. More resistance, more donations. By 2012 the company had abandoned their plans for NYC, and the Foundations donations dropped to $1.5 million.
It certainly seems like Walmart is donating more money in places where they want to open stores, which isn’t what charities are for. And if it turns out that this is exactly what they’re doing, they could face trouble with the IRS. The IRS hasn’t gotten involved yet, as investigations are a big deal and require significant evidence, but if the Walmart Foundation keeps this up, the IRS might not have a choice but to investigate.