Tom Coughlin (Walmart executive)

Career with Wal-Mart

Coughlin began his career with the retailer in 1978 in the company’s security division and eventually became vice president of loss prevention. He later became vice president of human resources. From January 1998 to January 1999, he was executive vice president and chief operating officer of the flagship Wal-Mart Stores Division. The next year, he headed the Wal-Mart Stores Division.

In January 2001, Coughlin was elected to the board of directors for ChoicePoint, a publicly traded data aggregation firm. That same year, he was elected to the Wal-Mart board of directors. In August 2002, he was also given the title of CEO for Sam's Club USA. The following April, he became executive vice president and vice chairman of Wal-Mart Stores, Inc.

On December 6, 2004, Wal-Mart announced that Coughlin would retire effective January 24, 2005. When Coughlin's retirement was announced, Wal-Mart praised Coughlin for his longtime success at the corporation. Wal-Mart CEO Lee Scott said in a company-issued press release, "Tom Coughlin has achieved one of the most successful business careers that anyone could imagine..."

Wal-Mart Chairman and founder Sam Walton's son, Rob Walton, added that "..I particularly respect the special relationship that he has built with our associates in the field. This says a lot about how well Tom Coughlin represents the Wal-Mart culture." Coughlin was quoted as saying it was "the right time for me to move on."

Legal troubles

In March 2005, Wal-Mart announced that Coughlin had resigned from the board of directors as a result of an internal investigation. The investigation alleged that the use of corporate-owned gift cards and personal reimbursements estimated to be in the range of $100,000 to $500,000.

Beginning in July 2005, he was the subject of a United States Department of Justice investigation, as well as a lawsuit by Wal-Mart, and was reviewed by a federal grand jury over misuse of company gift cards. When the charges first surfaced in April 2005, Coughlin claimed the money he embezzled was being used to pay bribes to trade union officials not to organize at Wal-Mart locations and to identify pro-union Wal-Mart workers.

He pleaded guilty to five counts of wire fraud and one count of filing a false tax return related to embezzlement and theft from Wal-Mart while serving as a member of its board. U.S. Attorney Robert Balfe told reporters the investigation had found no evidence backing Coughlin's earlier claims that the money he took was reimbursement for anti-union activities.

Coughlin was sentenced on August 11, 2006 at Fort Smith, Arkansas, to 33 months in home detention after pleading guilty to stealing money, merchandise and gift cards from the retailer. He avoided any prison detention, but was ordered to serve five years probation, and pay a $50,000 fine and about $411,000 in restitution to Wal-Mart Stores, Inc., and the Internal Revenue Service. He also was sentenced to 27 months of home detention

A physician stated in court that Coughlin was in poor health, suffering from diabetes, cardiac disease, sleep apnea, arterial blockage, and other ailments. Despite these medical claims, Coughlin was later seen at a National Wild Turkey Federation fund raiser in Benton County, Arkansas. Federal prosecutors were stunned to learn that Coughlin would attend such an event while under house arrest—especially since he claimed he was so ill.

Other lawsuits

Certain former Wal-Mart employees filed lawsuits against Coughlin for their purportedly inadvertent roles in his embezzlement of Wal-Mart funds. Former Administrative Manager Patsy Stephens deposited Wal-Mart money into her personal bank account and then wrote checks for her immediate supervisor (Robert Hey), for Coughlin, and for cash. She claimed she thought these practices were for the benefit of the company. She was convicted on eight counts of wire fraud by a federal jury in November 2007.