قالب وردپرس درنا توس
Home / Business / Markopolos says GE "a recession away from Chapter 11"

Markopolos says GE "a recession away from Chapter 11"



"GE is a recession away from Chapter 11. Their record is in ruins," said Markopolos's Julia Chatterley on CNNi's "First Move" show on Friday.

"We will see how liquid they are at the end of the year and whether they will succeed by 2020," he added.

GE shares fell more than 11% on Thursday, the worst decline since 2008. However, Friday rebounded along with the broader market, gaining nearly 9%. GE's inventory increased 17% in 2019.
Markopolos' explosive comments follow the publication of a 175-page whistleblower report in which he and his investigative team accused GE of committing nearly $ 40 billion in bill fraud in connection with his insurance plan Ask how it explains its involvement in the oil services company Baker Hughes ( BHGE ) .
In the report, Markopolos claims that GE ( GE ) is a bigger scam than Enron and WorldCom, both of which went bankrupt after accounting scandals beginning of the 2000s.
  Accounting analyst Harry Markopolos told CNNi to Julia Chatterley Friday that GE could go bankrupt in the event of a recession.

The company has shot down, alleging that the Markopolos claims are "unfounded" and denying its allegations of looming monetary crisis. "GE continues to have a strong cash position, committed lines of credit and various executable options to monetize assets."

As of June 30, GE had a debt of nearly $ 106 billion on its balance sheet – including liabilities of GE Capital – and only $ 71 billion in cash.

Markopolos became known as a whistleblower when he correctly predicted that Bernard Madoff's money management firm was a fraud before it collapsed in 2008.

GE is not the only one pushing back its recent demands. Another company that specializes in detecting accounting issues, Citron Research, has also questioned Markopolos' findings. The company said in a tweet that the report was "the worst thing asset sales by activists have to offer." Aggressive accounting is not a scam. " Citron added that the Markopolos report was "consistently insincere".

In a separate statement to CNN Business Friday, CEO Larry Culp said, "GE will always take any accusation of financial misconduct seriously, but that's market manipulation – plain and simple."

"Mr. Markopolos's report contains false facts, and these allegations could have been corrected if he had reviewed them before GE published the report." He bought $ 2 million worth of GE shares on Thursday, as well as several other GE insiders, as a sign of confidence in the company's future slimmer. Under the leadership of former CEOs Jack Welch and Jeffrey Immelt, GE was bloated. The company, which historically generated solid earnings growth, missed Wall Street's forecasts and plunged the stock.

On Friday, Markopolos told Chatterley that he continues to worry about GE's insurance business making the last minute of depreciation.

He noted that other insurance companies, such as Prudential ( PRU ) and Unum ( UNM ) avoided similar problems by creating adequate provisions to account for potential losses.

Markopolos also rejected GE's claims that he will benefit from the decline in the company's stock price because he works with a company that sells GE stocks and relies on the price to fall Make money from the decline.

He would not call the investment firm and simply say that he is "on the trail of the truth".

"When I see accounting fraud, I go after that," he said.

Markopolos added that he had "ongoing discussions" with the Securities and Exchange Commission and the Department of Justice over their investigations into GE's accounts, both the SEC and the DOJ. The SEC refused to comment on the status of its GE probe. The DOJ was not immediately available for comment.


Source link