When I first heard the story of Wal-Mart Stores Inc. (NYSE: WMT) employee Bruce Gabbard, who was fired for intercepting conversations between Wal-Mart executives and a reporter, it just didn't make sense.

Basically, the official story was that Gabbard was just disgusted with the way that Wal-Mart was being treated and decided that he was going to tap conversations with reporters. Shocked and disgusted by this act of unrestrained loyalty, Wal-Mart fired him because it prided itself on protecting the privacy of people it associated with, and wanted no part of Mr. Gabbard's shady dealings. If this post seems sarcastic, it's meant to be. The initial story seemed out of sync with Wal-Mart's obsession with gathering information, and not particularly indicative of the employer-employee relationship Wal-Mart is known for.

But now, Mr. Gabbard is saying that he was part of a "sophisticated surveillance operation that included snooping not only on employees, but also on critics, stockholders and the consulting firm McKinsey & Co," according to the Wall Street Journal (subscription required). That sounds pretty spooky, and has already drawn the inevitable comparisons to George Orwell's 1984. According to Gabbard, Wal-Mart hired two former FBI agents to set up systems so that the company could track calls from Middle Eastern countries. They also sent employees to infiltrate meetings of anti-Wal-Mart groups to find out when they were planning to picket Wal-Mart, and apparently set up systems to track the computer strokes of McKinsey employees suspected of leaking confidential documents to the media.

While these are just allegations and rumors, it's safe to say that they will do little to change the reputation of Wal-Mart from that of a paranoid, retailer-against-the-world giant located in Bentonville.