GE target of hoax saying it will return tax refund

BOSTON Wed Apr 13, 2011 1:32pm EDT

A faded, painted logo sits over the entrance to a General Electric Co. facility in Medford, Massachusetts July 17, 2009. REUTERS/Brian Snyder

A faded, painted logo sits over the entrance to a General Electric Co. facility in Medford, Massachusetts July 17, 2009.

Credit: Reuters/Brian Snyder

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BOSTON (Reuters) - General Electric Co, embroiled in controversy over its low 2010 U.S. tax bill, was the target of a bogus press release claiming that it would donate billions of dollars to the federal government.

The official-looking release, complete with the GE logo and slogan "imagination at work", said that GE would send its $3.2 billion tax refund from 2010 back to Washington.

The Yes Men, an activist group known for issuing hoax statements claiming major attitude changes in corporate America, said it sent the release in an e-mail to media outlets on Wednesday.

"It's a hoax and GE did not receive a refund," said Deirdre Latour, a spokeswoman for the largest U.S. conglomerate.

The spoof came amid an ongoing battle in Washington between President Barack Obama's Democratic party and the Republican-controlled House of Representatives over how to cut the nation's budget deficit.

GE shares slipped after at least two news organizations, the Associated Press and Dow Jones, reported the hoax as fact.

AP later pulled its story, which AP spokesman Paul Colford said was "clearly a case of editorial error."

Dow Jones followed up its headline, which cited the AP, with GE's rebuttal.

"We moved to clarify the original headline as soon as we became aware of the situation," said spokeswoman Ashley Huston.

GE shares were down 4 cents at $19.97 in early afternoon trading.

In October 2009, the Yes Men staged a phony press conference to "announce" that the U.S. Chamber of Commerce had reversed its opposition to climate-change legislation.

Reuters was among the news organizations to fall for that hoax, and later withdrew its story.

Fairfield, Connecticut-based GE's tax rate has been in the public eye since the New York Times reported last month that it paid no U.S. income taxes in 2010, a claim that GE denies.

GE has acknowledged that its 2010 tax bill was low due to hefty losses at its GE Capital finance unit during the financial crisis.

Chief Executive Jeff Immelt acknowledged in a March speech in Washington that the company tries to keep its tax bill as low as it can but said it does so legally.

"Our tax rate will be higher in 2011," said Immelt, whom Obama in January named to head a new White House panel aimed at driving jobs growth. "We do it in a compliant way. There are no exceptions."

The Yes Men sent the release to draw attention to GE's approach to taxes, said Andrew Boyd, who said he was a member of the group.

"This is unpatriotic, it's undemocratic, it's unfair," Boyd said in a telephone interview. "It might be legal but it's immoral."

(Reporting by Scott Malone, editing by Gerald E. McCormick, Dave Zimmerman and Ted Kerr)

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Comments (6)
JamVee wrote:
Can’t the “Yes Men” be prosecuted for fraud? Or, do we even know who they are?

I am no fan of GE, but then, I am no fan of fakes and liars either.

Apr 13, 2011 1:34pm EDT  --  Report as abuse
tmarket wrote:
A hoax involves deception, but without the intention of gain or of damaging or depriving the victim.

A fraud also involves deception, but with the intent of monetary gains. For example, a corporation can be sued for fraud by filing false income statements because there was intent of monetary gains.

Apr 13, 2011 2:18pm EDT  --  Report as abuse
GeneB19 wrote:
“It might be legal but it’s immoral.”

Perfect description of GE.

Apr 13, 2011 6:18pm EDT  --  Report as abuse
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