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Indian e-commerce giant Flipkart is under the scanner. Whistleblower complaints have prompted Walmart to examine alleged kickback payments involving Flipkart employees. The allegations concern staff working in the e-commerce company's smartphone and luggage and travel accessories (LTA) divisions, who are suspected of receiving payments and other benefits of over ₹150 crore ($16 million) from brands and vendors.
According to a Moneycontrol report, citing four people familiar with the matter, the investigation is still underway. Walmart, which owns more than 80% of Flipkart, is examining the allegations to determine the extent of the suspected wrongdoing and the amount involved.
A source quoted in the report said that the exact nature of the alleged misconduct would become clearer in the coming weeks. “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. Walmart will then take necessary action,” a source was quoted as saying.
Two additional sources familiar with the matter also confirmed the information to the outlet.
How Did the Alleged Kickback Arrangement Work?
According to the report, some Flipkart employees allegedly received benefits from brands in the smartphones and luggage and travel accessories categories in exchange for giving them preferential treatment.
The alleged arrangement reportedly involved Flipkart's business-to-business (B2B) operations. The report said that some employees took payments from vendors of mobile phone brands when devices were being transferred between businesses.
Walmart had also looked into alleged financial misconduct involving employees in Flipkart's luggage and travel accessories division about two-and-a-half years ago. According to a source cited by Moneycontrol, at least three employees were terminated after that investigation.
In exchange, these Flipkart employees ensured that sellers received preferential treatment, including greater visibility, on the platform, which resulted in higher sales for the vendors concerned.
Third Walmart Investigation At Flipkart
The latest probe is reportedly the third investigation Walmart has conducted into alleged financial misconduct at Flipkart in less than three years.
Walmart had also looked into alleged financial misconduct involving employees in Flipkart's luggage and travel accessories division about two-and-a-half years ago. According to a source cited by Moneycontrol, at least three employees were terminated after that investigation.
Another investigation reportedly took place around six months ago in the smartphones division. A source said one employee was found guilty of the allegations and resigned before the company could terminate their employment.
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Flipkart employees under Walmart probe over alleged ₹150 crore kickbacks for preferential treatment: Report
