If you're reading this, you probably know that Wal-Mart has applied to start its own industrial bank. They say it's just to process credit card transactions, but a lot of people are afraid that Wal-Mart will move into traditional banking functions and do the same thing to local banks that they've already done to local retailers. "Absolutely not," says Wal-Mart. "We already have banks in many of our stores and we can't just kick them out and replace them with our own." Or maybe not. From Reuters:
Last month, the company told the Federal Deposit Insurance Corp., the agency reviewing Wal-Mart's application to start limited bank operations, that it has no plans to enter full-service banking, and it pointed to the leases signed by banks in its stores as evidence of its long-term plan to support independent banks. Specifically, Wal-Mart told the FDIC that leases signed by banks were renewed at the discretion of the banks alone. But documents seen by Reuters include a provision that requires both the bank and Wal-Mart to agree to renew.Oddly enough, Reuters downplays its own scoop:
According to industry sources, that provision is included in a handful, not all of the leases signed by Wal-Mart's bank tenants. Wal-Mart told Reuters it was an oversight and that the testimony it gave to the FDIC it had believed to be true.Representative Barney Frank has already asked Wal-Mart to produce all the leases. If they don't do that, their application should be rejected without a moment's hesitation. But this is bigger than that. Did Wal-Mart really not bother to check its own cover story? I can hear the chatter in Bentonville now, "As long as we don't know it's false, we can claim it's true." I've said it before and I will undoubtedly say it again: Wal-Mart lies all the time about absolutely everything. Next time you hear someone say that Wal-Mart is no worse than Target, remember that Target hasn't been caught lying to a federal agency.