Inside G.E., a Little Bit of Enron

[Guest kumar]

Poor SEC!  How can it effectively investigate frauds in large corpoations and hedge funds/naked short sellers with such a small budget?

 

http://www.nytimes.com/2009/08/07/business/07norris1.html?ref=global

 

..This week General Electric agreed to pay $50 million to settle a suit filed by the Securities and Exchange Commission that said the company fiddled with its books repeatedly early in this decade..

 

..While it may seem odd to view the government as an underdog, it was. G.E. says it spent $200 million on outside lawyers and accountants in dealing with the investigation. By contrast, the S.E.C.’s entire annual enforcement budget, spread over thousands of inquiries and investigations, was less than $300 million when this investigation began in 2005..

[link01]

this isnt too surprising. for all jack welshes operational zeal & excellence it was pretty obvious that he wasnt above playing the wall street game of 'making the quarterly no.'s' at the corporate level. the finance/leasing arm was an especially "valuable" tool in that regard.