U.S. SEC says GE to pay $200 mln penalty for misleading investors (updated)

Ge Power India

09/12/2020 22:21

(Adds detail)
    By Katanga Johnson
    WASHINGTON, Dec 9 (Reuters) - The U.S. Securities and
Exchange Commission said on Wednesday that General Electric
Co GE.N  has agreed to pay a $200 million penalty to settle
charges for misleading investors over how it was generating
earnings in its power and insurance businesses.
    In 2017 and 2018, the company's stock price fell almost 75%
as challenges in its power and insurance businesses were
disclosed to the public, the SEC said.
    The company misled investors by failing to explain that
one-quarter of its GE Power profits in 2016 and nearly half in
the first three quarters of 2017 stemmed from reductions in its
prior cost estimates, the SEC said.
    The order also finds that GE failed to tell investors that
its reported increase in current industrial cash collections was
coming at the expense of cash in future years, the SEC said. 
    "Public companies must provide an accurate picture of their
business. It's really very simple," SEC enforcement chief
Stephanie Avakian told reporters during a press briefing on
Wednesday.
    "You must speak accurately, about the manner in which you
are meeting financial targets and about trends and
uncertainties, you are aware of in your business."

 (Reporting by Eric Beech; Editing by Doina Chiacu and David
Gregorio)
 ((eric.beech@thomsonreuters.com; 202-898-8322; Reuters
Messaging: eric.beech.reuters.com@reuters.net))