(Reuters) – General Electric Co’s <GE.N> former employees are being questioned by federal investigators about details in a legacy insurance business that led to accounting issues at the conglomerate last year, the Wall Street Journal reported https://www.wsj.com/articles/in-ge-probe-ex-staffers-say-insurance-risks-were-ignored-1543580971 on Friday.
GE is working with investment bankers to find ways to shed its insurance business, which has caused it to book hefty charges while sparking shareholder lawsuits and an investigation by U.S. regulators, Reuters reported in May.
The insurance business failed to internally acknowledge worsening results over the years, the WSJ reported, citing several former GE employees.
Former employees described examples of what they call lax managerial oversight and buried risks that ultimately kept the company from booking bigger reserves, according to the report.
“We are exploring every option to manage and mitigate risk from the company’s legacy insurance liabilities,” GE told Reuters.
The company said it is not going to comment on the specifics of ongoing legal matters.
(Reporting by Sanjana Shivdas in Bengaluru; Editing by James Emmanuel)