I have been using this newsletter to address a broader set of topics of interest over time, from Power to Aviation to Insurance as well as our quarterly results, and I will continue to do so given investor feedback.
People have been asking us about how we are responding to a third-party report on GE’s accounting that received significant coverage in the press. As a result, I simply wanted to share what we published yesterday in one place to make it easy for you to find.
- Initial press release. Yesterday GE issued a statement in response to the allegations made in the report. Read the full statement here.
- Additional statements. We also shared statements from GE Chairman and CEO Larry Culp and Independent Director and Audit Committee Chair Leslie Seidman. Here they are for your reference:
- H. Lawrence Culp, Jr., GE Chairman and CEO: “GE will always take any allegation of financial misconduct seriously. But this is market manipulation – pure and simple. Mr. Markopolos’s report contains false statements of fact, and these claims could have been corrected if he had checked them with GE before publishing the report. The fact that he wrote a 170-page paper but never talked to company officials goes to show that he is not interested in accurate financial analysis, but solely in generating downward volatility in GE stock so that he and his undisclosed hedge fund partner can personally profit.”
- Leslie Seidman, GE Independent Director and Audit Committee chair, former chair of the Financial Accounting Standards Board (FASB): “The representations by Mr. Markopolos about GE’s accounting practices are simply not accurate. The report contains numerous novel interpretations and downright mistakes about the actual accounting requirements, making his conclusions about GE’s reporting questionable at best.”
- Leslie Seidman on CNBC. Leslie also spoke with Morgan Brennan on CNBC about our integrity and confidence in our Company. I’d encourage you to watch the interview here.
- Insider stock purchases. We filed Form 4s yesterday disclosing that Larry purchased an additional 252,200 GE shares yesterday, representing another $2 million in purchases. Independent Director Paula Rosput Reynolds purchased 5,000 shares yesterday as well. These purchases follow separate purchases earlier this week by Larry (331,684 shares), Paula (5,000 shares), Chief Human Resources Officer Kevin Cox (105,600 shares), and Lead Director Tom Horton (55,248 shares) and indicate our leaders’ continued confidence in GE’s long-term strengths.
As always, please don’t hesitate to reach out with questions, comments or other topics where additional information or clarification might be helpful.
Steve Winoker
VP Investor Communications