Walmart has launched an investigation into alleged financial misconduct at Flipkart after whistleblower complaints that employees accepted kickbacks worth more than ₹150 crore, according to reports from Moneycontrol. The alleged wrongdoing involved employees in Flipkart's smartphones and luggage and travel accessories divisions, who were accused of accepting payments from vendors in exchange for preferential treatment on the platform. The investigation is ongoing, and the extent of the alleged misconduct and the amount involved have yet to be established. As per Moneycontrol, investigations are still underway, and the quantum and exact nature of the wrongdoing, including the amount taken by certain employees in kickbacks, will become clear over the coming weeks.
Some employees allegedly exploited Flipkart's business-to-business operations to collect payments from vendors moving mobile phones between businesses, as reported by Moneycontrol. In return, these employees allegedly provided preferential treatment to certain sellers, including greater visibility on the platform, helping them increase sales. The employees were found to be largely exploiting the business-to-business route at Flipkart. Some Flipkart employees took a cut from vendors of certain mobile phone brands when devices were moving from one business to another. At Flipkart, certain employees were understood to have accepted favours from brands across the smartphones and luggage and travel accessories categories in exchange for preferential treatment.
The allegations mark the third investigation by Walmart into suspected financial misconduct at Flipkart in less than three years, according to Moneycontrol. Walmart previously investigated alleged financial irregularities in Flipkart's luggage and travel accessories division about two-and-a-half years ago, resulting in the termination of at least three employees. A separate investigation into alleged wrongdoing in the smartphones division took place about six months ago, with one employee found responsible for the alleged misconduct resigning before the company could dismiss them. The details of the first two investigations have not been reported previously.
The investigations come as Flipkart faces a series of senior-level departures and uncertainty over the timing of its long-anticipated initial public offering, as reported by Moneycontrol. At least 14 vice presidents and senior vice presidents have left the company over the past year. Kanchan Mishra, vice president of smartphones; Amit Sachan, vice president of product and technology; and Kamal Chopra, vice president of corporate tax, are also reportedly set to leave Flipkart. Flipkart employees have been looking to a public listing as a potential opportunity to cash out their employee stock options, with the absence of a firm IPO timeline leaving them uncertain about when they might be able to realise the value of their holdings. At least 1,000 former Flipkart employees had also written to the Walmart board a few weeks ago, seeking parity with current employees in the event of a stock buyback.
