GE's CEO said allegations of fraud by Madoff whistleblowers Harry Markopolos are false, and driven by market manipulation.
"GE will always take any allegations of financial abuse seriously. But this is market manipulation – plain and simple," said Lawrence Culp, chairman and CEO of GE, in a statement. "Mr. Markopolo's & # 39; report contains false statements of fact, and these allegations could have been corrected if he had checked them with GE before publishing the report."
Culp said the fact that Markopolos never spoke with the company's officials before the publication of the report "goes to show that he is not interested in accurate financial analysis, but solely in generating downward volatility in the GE stock, so he and his "
Markopolos targeted Thursday GE in a 1
An American hedge fund, which Markopolos would not name, paid Markopolos to research and publish its report, and Markopolos told CNBC that he received a "decent percentage" of the profits the hedge fund would earn from investing against GE.
GE Board Director and Audit Committee Chairman Leslie Seidman also accused Markopolos of being accurate.
"The report contains many new interpretations and direct errors about the actual accounting requirements, making his conclusions about GE's reporting at best questionable," she said in a statement. "In his own words, he will personally be able to take advantage of today's significant market response to the report, and he is selectively ahead with widely reported regulatory processes and rigorous investigations without the benefit of access to GE's books and records." [19659008ReportEnumeratesLanyAccountingIrregularityIfMarkoPossierCreationCfraudAt$38BillionDollarAccordingto40%OfMarketValueMyReportingConceptsOnBusinessWithAccountAccordingtoTheCompanyIt'sConfirmIt'sConfirmTo"WorldComandEnronlastedaboutfourmonthsWe'llseehowGEdoes"
The GE stock, which has long been under pressure, fell by more than 11%, according to Markopolos' report to $ 8.01 per share.
Markopolios & # 39; report noted that GE has a long history of accounting fraud, dating back to 1995 when it was run by Jack Welch.
He called the alleged insurance fraud "bigger than Enron and WorldCom together."
Seidman said, "I urge readers to carefully consider the motivation behind this report, as well as the reliability of the analysis that underlies his opinions."