Markopolos one of many to accuse GE of faulty accounting: Ajamie LLP's Tom Ajamie

I was looking at it from a different perspective because I was interested in specifically what he was saying about subsidiaries of the company but you know this has become kind of interesting because now you've got short versus short you've got spy versus spy it reminds me a tremendous amount about Herbalife because you know I was on one side of that with the reporting we were doing when I was at CNBC and it was just interesting watching different people just get different opinions in the end what I looked at was this look he disclosed the short seller position the report was certainly well over the line and what a lot of people want to see and what people will say his reputation is tremendously on the line with us yeah but in the end the real question is is he right or is he wrong and we won't know he says we'll know in three to six months time though at some point what what is your point of view on this okay so look the counting of General Electric which mr. Markopolos is questioning okay and he's attacking the accounting this is nothing new this has been going on for years now people have been attacking the accounting and I think in my opinion justifiably so KPMG has been the accountant forever there's been a lot of calls to replace KPMG and get someone in new get a new accounting forum in to look at their work right there's shareholder lawsuits already on file the Southern District of New York is already hearing a bunch of cases where the shareholders are suing saying that the accounting is faulty and phony and and and be manipulated by the accounting firm and by General Electric so mr. Markopolos is just another another hammer at General Electric on their accounting problems right but he's known this for a while it's one thing to say there have historically been accounting problems and it's another thing to say as he is claiming today the General Electric is bankrupt yeah well I mean golly it depends how you paint defend bankruptcy I mean look there are over a hundred billion dollars in debt and their market cap is a lot less than that okay so on some definitions they might be bankrupt and he's also saying he's also added you're right that there are some additional accounting maneuvers and tricks that haven't been exposed yet and so he's bringing up some new ones too in herb I wonder you know when we talk about Marco Polo's is very straightforward he said look I have mouths to feed yes I'm working with this hedge fund of course the hedge fund has not been disclosed do we need more transparency about the profit structure of this for example you know is he required to be in other words was the the difference between insider trading where they're hedge fund could have already made a position before this was made public to everybody versus what happens now in further shared declines and whether he participates in those declines what what questions do you think regulators if any need to be asking well I think when they get to the issue of manipulation I think manipulation would be determined if he intentionally put out this information and he and the short and the short or the fun that he was involved with intentionally put out misleading and wrong information I would find that hard to believe but again I just you know know what I what I'm looking at here but I think that's the line remember the bloggers the activists short sellers they've been out there for four years and the difference in this one is that it's GE it's not some little podunk company over here a lot of people never heard of or a company that I would call a not TV name because you this is going on all the time this is just different because I think of the size and the claims that he is put forth and and again Tom we've seen people come out from many corners to say you know while they're flagging accounting issues that's not the same the the severity of what he's claimed and goes beyond what he's been able to demonstrate if you are somebody who's worried about the GE shares you own going to zero about the pension you have which again at least has a backstop what questions should those people be asking well those bills people might want to look at the lawsuits that are already on file I mean there there's so many claims of accounting gimmicks and maneuvers you can put GE and KPMG into Google right now and you can read about various unions and other groups have come in and in saying look there's a lot of accounting fraud that's oh this is coming from all directions mr. Markopolos is like the hundred and twenty-fifth person to raise accounting issues with General Electric it's a serious problem if I had money in general metric personally I would probably be out of it I think you ought to be very cautious it's dangerous oh yeah final word well I just want to say it say one thing we've done a lot of work on a company called web tech they acquired general electric transportation that's a tidy that was a tiny part of General Electric transportation and what we were intrigued with when we did the work and trying to untangle it and my partner who's one of the great forensic accountants out there and our analysts they're pulling their hair out because when they were looking at GE T general electric transportation which makes locomotives it was like a black box they were having trouble figuring it out and we found inconsistencies and numbers that we couldn't get lab tech to answer as it related to general after transportation so there's so much there yeah that you know he's on it we all know he's onto something you don't know what it is it's a great one to follow it's a black box it's not going to end up well in my opinion you

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Id: hEQTjpNBM_s

Length: 5min 17sec (317 seconds)

Published: Fri Aug 16 2019