GE CEO Slams Whistleblower Report As ‘Market Manipulation’
Rachel Sandler, 15 August 2019
In response to a whistleblower report claiming to have uncovered massive accounting irregularities at General Electric, CEO Larry Culp said the author of the report, who previously raised concerns about Bernie Madoff’s ponzi scheme years before it was brought down, is engaging in “market manipulation” and stands to gain by tanking GE shares.
Harry Markopolos claims in the 175-page report that GE is falsifying financial statements to cover up massive losses related to its long-term-care insurance unit and the company’s oil and gas business, adding that GE is using many of the same accounting practices Enron did.
Markopolos admitted in an interview with the Wall Street Journal he is working with an unnamed hedge fund that is shorting GE stock. He told CNBC, “I need to get paid, I have a family to support,” when asked if he has any conflicts-of-interests.
GE shares fell more than 11% following the report’s release.
In a statement responding to the report, the company said, “The claims made by Mr. Markopolos are meritless. The Company has never met, spoken to or had contact with Mr. Markopolos, and we are extremely disappointed that an individual with no direct knowledge of GE would choose to make such serious and unsubstantiated claims.”
