I first discussed General Electrics accounting games back in February of 2018. See here. Their financial statements did not pass the smell test. Now Harry Markopolos is out with a detailed report calling GE the next Enron. Here are some details you may not know.
The obvious questions is: if this 14.7% profit margin was real, why isn’t their $29 billion Long Term Care liabilities fully reserved and why is their pension shortfall amount to $27.2 billion?
Mr. Markopolos detailed his fraud allegations on CNBC.
As a side note, the amount of faith the CNBC panel puts in government regulators is astonishing to me. It has always been private institutions and individuals outside the government warning about these type of issues first. Markopolos alerted the SEC to Madoff’s Ponzi scheme on three separate occasions going back to the year 2000. Each time he was ignored. He wrote a book about it called, “No One Would Listen“. I suspect the SEC will take Markopolos warning series this time since he has a bit of a following now. Bureaucracies hate bad publicity.