re: General Electric, a Bigger Fraud than Enron

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By now you have seen headlines reporting on allegations from a third-party regarding GE’s accounting. We believe these claims are meritless and ill-informed. And I want you to know the facts. First and foremost, GE operates at the highest level of integrity and stands behind its financial reporting. We remain focused on running our businesses every day, following the strategic path we have laid out. Second, contrary to these unsubstantiated allegations, GE continues to maintain a strong liquidity position, including more than $16B in Industrial Cash, and $35B in committed credit lines. We also have additional options available to us down the line to generate cash to help bring down our leverage, including our remaining interests in BHGE. And third, context matters. The individual who published this report today openly acknowledges that he is paid by unnamed hedge funds. Such funds are financially motivated to attempt to generate short selling in a company’s stock to create unnecessary volatility. I suspect they did pretty well today. The report they published today even states that those “positions taken by the third-party entity are designed to generate profits should the price of GE securities decrease.” GE will always take any allegation of financial misconduct seriously. But this is market manipulation – pure and simple. This individual’s report contains false statements of fact and claims that 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. While we still have much work ahead of us, we are making great strides to return GE to a position of strength—and that’s in large part to the work you do each and every day to serve our customers around the world. I’m proud to be on this team, and I remain confident in our company and our strategy to improve our financial position. On CNBC this morning, this individual justified his actions by saying, “I have a family to support.” Well, so do I and so do you. We’ll do so by taking the high road, serving our customers and delivering for our shareholders. Thank you for all your hard work on our behalf. Larry

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