GEnron? Markopolos versus General Electric (A)
In August 2019, Harry Markopolos-the forensic accountant known for uncovering Bernie Madoff's Ponzi scheme-alleged that General Electric had committed accounting fraud totaling $38 billion, coining the term "GEnron" for perceived similarities with the 2001 accounting fraud at Enron that brought down that company and its auditor. Specifically, Markopolos claimed, GE would need to generate $29 billion in reserves against its insurance obligations, and restate its financials to recognize $9 billion in unreported losses on an oil subsidiary. Though GE management rejected these assertions, repeated writedowns and restatements of GE's performance since 2017 had made investors wary. They now scrambled to assess the merits of Markopolos's claims.