GE Fined by SEC 7 Years Late

GE (GE) settles with SEC and pays a civil fine of $50 million. GE which was the mother of quality investment plays apparently misled investors in 2002 and 2003. In the press release Robert Khuzami, director of the S.E.C.’s Division of Enforcement chastised GE saying “Overly aggressive accounting can distort a company’s true financial condition and mislead investors.”

No one mentioned any disciplinary fines against individuals, key officers or the board of directors. It appears that the infractions occurred exactly after Jack Welch left the company. Infractions of this size and nature are not the work of one individual but are reflective of corporate culture. Then again the fine is a drop in the bucket for GE and is really just a licensing fee.

The real story is that it took the SEC 7 years to nail GE.