Walmart has launched an internal investigation into alleged financial misconduct at Flipkart after whistleblower complaints accused employees of receiving kickbacks worth more than ₹150 crore. The probe reportedly involves staff in the e-commerce company’s smartphones and luggage and travel accessories (LTA) divisions.
The allegations have raised questions about Flipkart’s internal controls and vendor relationships. The investigation is ongoing, and the exact amount involved and the nature of the alleged wrongdoing have yet to be established.
How the Alleged Kickback Scheme Worked
According to reports, some Flipkart employees allegedly accepted payments or favours from vendors in exchange for preferential treatment on the platform.
The alleged misconduct reportedly involved Flipkart’s business-to-business (B2B) operations, where employees are said to have taken cuts from vendors supplying mobile phone brands as devices moved between businesses.
In return, certain sellers allegedly received better visibility and preferential treatment, helping them generate higher sales.
The investigation is examining the allegations, including the possible involvement of employees in the smartphones and LTA categories. The findings are expected to determine the extent of the alleged misconduct and whether disciplinary action is warranted.
Third Internal Investigation in Less Than Three Years
The latest probe is reportedly the third investigation Walmart has initiated at Flipkart in under three years over alleged financial misconduct.
Around two-and-a-half years ago, Walmart investigated employees in the luggage and travel accessories division over financial misappropriation. At least three employees were reportedly terminated following that investigation.
A separate probe into the smartphones division took place around six months ago. One employee was reportedly found guilty of the allegations and resigned before the company could dismiss them.
The latest investigation follows these earlier cases and is expected to examine whether existing governance and compliance measures were sufficient to prevent alleged wrongdoing.
Flipkart Reaffirms Commitment to Governance
In response to the allegations, Flipkart said it has robust governance processes and controls and remains committed to the highest standards of integrity and compliance.
The company stated that it takes concerns seriously and addresses them through established processes. It also reiterated its commitment to ethical conduct across its business.
Walmart owns more than 80% of Flipkart and is conducting the investigation. The precise findings and any action against employees will depend on the outcome of the inquiry.
Investigation Comes Amid IPO Uncertainty
The development comes at a challenging time for Flipkart, which has seen several senior-level departures and growing concerns among current and former employees about the liquidity of their employee stock ownership plans.
The company’s proposed initial public offering (IPO) also remains without a confirmed timeline. Reports indicate that at least 14 vice presidents and senior vice presidents have left Flipkart over the past year.
The investigation adds another challenge for the e-commerce company as it works to maintain investor confidence and strengthen internal governance.
