Former Wal-Mart Exec Sentenced for Theft

Former-Wal Mart Stores Inc. vice president Tom Coughlin, left, and his wife Cynthia, right, leave a Fort Smith, Ark., federal courthouse after he pleaded guilty to fraud and filing a false tax return in a file photo from Jan. 31, 2006. The former No. 2 executive at Wal-Mart Stores Inc. is sentenced after pleading guilty to stealing money, merchandise and gift cards worth just a fraction of his base salary and stock holdings. Thomas Coughlin, 57 and a protege of late Wal-Mart founder Sam Walton, faces a maximum of 28 years in prison and could be fined $1.35 million. (AP Photo/April L. Brown, File) (April L. Brown - AP)

"It is obvious that the activity that I was involved in had gone on for a number of years and was in fact acknowledged by members of management even though they did not know the specific details," he said, reading from a written statement. He did not take questions and did not elaborate.

WakeUpWalMart.com, a union-backed campaign group critical of Wal-Mart, said Coughlin's words raised "serious and troubling questions" about possible anti-union activities.

Coughlin had faced a maximum of 28 years in prison on five counts of wire fraud and one count of filing a false tax return and fines up to $1.35 million.

Dr. Joel Carver of Northwest Arkansas Heart and Vascular Center told U.S. District Judge Robert Dawson that Coughlin suffers from pulmonary hypertension, diabetes and sleep apnea. Dr. Carver said prison life would be life-threatening for Coughlin because of those conditions.

Wal-Mart referred Coughlin to federal prosecutors after alleging he took money, goods and gift cards worth up to $500,000 over a period of at least seven years before he retired in early 2005.

Coughlin, who joined Wal-Mart in 1978 as head of theft prevention, retired as vice chairman in January 2005 and gave up his spot on the company board in March 2005 after Wal-Mart referred him to prosecutors. The matter was taken up by a grand jury in Fort Smith.

In court in January, Coughlin specifically admitted defrauding the company to pay for the care of his hunting dogs, lease a private hunting area, upgrade his pickup truck, buy liquor and a cooler, and receive $3,100 in cash. The items were worth a total of $14,395.

As vice chairman, he received a base salary of $1.03 million in his final year with the company. He received more than $3 million in bonuses and other income in the same period and held about $20 million in Wal-Mart stock, according to Securities and Exchange Commission filings.

Wal-Mart made further allegations of embezzlement and theft in a separate civil lawsuit it filed last year seeking to revoke Coughlin's multimillion dollar retirement package.

That suit alleges that Coughlin used tricks including false expense reports to buy things as varied as snakeskin boots, hunting trips and Bloody Mary mix.

However, that lawsuit was dismissed by an Arkansas judge who said both sides had signed a pledge as part of Coughlin's retirement deal not to pursue any claims against each other for any reasons. Wal-Mart has appealed the dismissal of its lawsuit to the Arkansas Supreme Court.