Here is the latest story in the growing ethics scandal involving Wal-Mart CEO Lee Scott. As the article later states, "Supplying a diamond ring for a chief executive's wife would appear an unusual order for The Aaron Group, which on its Web site describes itself as a "maker of popular priced" jewelry."

From The Wall Street Journal:

Wal-Mart Stores Inc. Chief Executive H. Lee Scott, who recently was accused by a fired marketing executive of accepting sweetheart deals from suppliers, purchased a diamond ring from a Wal-Mart vendor, according to that vendor's officials.

Mr. Scott purchased the ring for his wife in April 2003 from The Aaron Group, a wholesale supplier of jewelry to Wal-Mart, said Robert Kempler, president of the New York-based company. Mr. Kempler declined to discuss the terms of the diamond sale other than to say Mr. Scott hadn't received preferential pricing.

Wal-Mart's famously strict ethics code prohibits employees from receiving anything free from suppliers. Last week, Julie Roehm, a former Wal-Mart marketing executive who was fired in December for allegedly violating the retailer's ethics rules, claimed in a federal court filing that Mr. Scott obtained "a number of yachts" and "a large pink diamond" at preferential prices.

The lawsuit didn't identify the specifics of the diamond sale, other than to say that Mr. Scott had purchased the stone through a relationship with Irwin Jacobs, a financier who has numerous business relationships with Wal-Mart. It isn't clear whether the diamond ring purchased from The Aaron Group is the same one referred to in Ms. Roehm's suit.

Mr. Kempler said he'd never heard of Mr. Jacobs, and he said everything about the transaction was "above board." Mr. Jacobs called the allegations without any substance and has denied knowing anything about any diamond purchase by the Wal-Mart CEO.

A Wal-Mart spokeswoman declined to comment specifically on the diamond purchase or Wal-Mart's policies on employee purchases from suppliers. Mr. Scott "is subject to the same ethics policy as any other associate and has not violated either the spirit or the letter of Wal-Mart's ethical standards," the spokeswoman said. She characterized the allegations in Ms. Roehm's court filing as "old news. No facts have been presented to back them up."

Charles Elson, Director of the John L. Weinberg Center for Corporate Governance at the University of Delaware, said Mr. Scott shouldn't have been doing business with any vendor, even if the deal was in accordance with Wal-Mart's ethics rules. "Someone at that level, at that paygrade, should avoid dealing with the company vendors," Mr. Elson said. "It sends the absolute wrong signal to the rest of the organization, particularly one that prides itself on its relationships with vendors."