General Electric

GENERAL ELECTRIC (GE) is a massive multinational conglomerate, with 107 factories in the United States and 103 overseas plants in 23 foreign nations. It employs 243,000 American workers and has about 500,000 stockholders. About 300 major retail stores use its credit card system, and its NBC television network has about 200 affiliate stations in the United States.

General Electric is the third-largest defense contractor, and the nation's second-largest plastics manufacturer, the owner of RCA, has its own cable television network, and is a stockbroker (it owns Kidder Peabody). Moreover, it has its own bank, GE Capital, which has $91 billion in assets. General Electric is also among the most lawless of American corporations. For example:

1957–61. GE was convicted of price-fixing and other charges for electrical equipment valued at $1.74 billion per year, the largest price-fixing case in the history of the Sherman Antitrust Act to that time.

1988. GE was indicted on 317 counts of fraud in connection with a scheme to defraud the U.S. Army of $21 million on a logistics computer contract.

Indeed, GE has a very long history of corporate crime. Other examples include:

[Page 352]1981. GE was convicted of paying a $1.25 million bribe to a Puerto Rican official to obtain an electrical plant contract. Three GE executives were imprisoned in the case.

1986. GE officials at a machine tool company were charged with providing kickbacks to three former GE purchasing employees to obtain Pentagon subcontracts.

1987. It was exposed that GE supplied thousands of defective military and civilians airplane engines to customers. The defects included cracks in tubing and brackets in the F-404 engine used in the F-18 Navy fighter, the T-700 helicopter, and the CT-7 for small commuter planes.

GE's stock brokerage firm, Kidder Peabody, paid $25.3 million to settle an insider-trading complaint with the Securities and Exchange Commission (SEC). GE Capital paid a $275,000 civil penalty in 1989 for discriminating against low-income consumers, the largest fine ever under the Equal Credit Opportunity Act. GE paid a $32 million settlement to women and minorities in an employment discrimination case, and its Canadian subsidiary was convicted (along with Westinghouse and other firms) of conspiring to fix prices on light bulbs.

GE is also a major environmental polluter. Four of its factories are on the Environmental Protection Agency's (EPA) list of the most dangerous industrial sources of toxic air pollution, and GE has been identified as responsible for contributing to the damage of 47 sites in need of environmental clean up. The company has also paid tens of millions of dollars in out-of-court settlements for its toxic dumping of chemicals.

In the early 1990s, problems including bribery and mis-pricing became so pervasive that the Pentagon's Defense Contract Management Agency took the unique step of setting up a special investigations office just for GE. The office secured 22 criminal indictments against the company, its sub-contractors and employees, and recovered $221.7 million in fines and settlements.

Between 1990 and 2002, GE has been involved in 63 cases brought by the federal government against it, and has settled claims for $982.9 million, more than any other corporation in America.

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