SEC seeks records of GE’s disclosures in financial crisis

Propublica reports:


Hank Paulson’s memoir about the financial crisis, “On the Brink: Inside the Race to Stop the Collapse of the Global Financial System [2],” has become a best seller. But for his friend Jeff Immelt, the CEO of General Electric, the book has become a bit of a headache.
Last week, the company disclosed that the Securities and Exchange Commission is reviewing what the company said publicly about its liquidity in September 2008, as the crisis unfolded. Paulson’s book says Immelt told him on Sept. 8 and Sept. 15 that GE was having difficulties selling its short-term debt, or commercial paper, and that Immelt’s description of the problem alarmed him.

GE at the time was publicly reassuring investors [3] that its financial situation was strong. This letter [4] to investors on Sept. 14 states that GE’s commercial paper programs “remain robust.”

With our publishing partner The Washington Post [5], we disclosed the differences between the Paulson account and GE’s public statements back in February, shortly after the book was published. Immelt, in a statement for that article, said he “does not believe” he and Paulson discussed problems with GE’s commercial paper program during their September discussions.

The company also said all its disclosures from the relevant time period were accurate, a point that GE spokeswoman Anne Eisele repeated last week in confirming the company is cooperating with an SEC request for records. Eisele declined to answer a question about whether Immelt or the company has requested that Paulson’s publisher correct the account of the conversations in subsequent editions.