Court lifts veil on GE finances
The Federal Court, during the process of ordering consumer credit provider GE Capital Finance Australia to pay a penalty of A$1.5 million for making false or misleading representations, gave some insight into the income, cash flow and balance sheet of the business, which trades as GE Money.The case revolved around Australian Securities and Investments Commission allegations that, in the first half of 2012, GE Money misled more than 700,000 credit card customers, omitting crucial advice on terms of consent for credit cards to be activated and credit limits to be applied for or increased.The timing was important, as GE Capital engaged in the conduct shortly before the Government's prohibition on unsolicited invitations to increase credit card limits came into effect on 1 July 2012. In imposing the $1.5 million penalty, the court said: "What was involved was an attempt to obtain consents in an unlawful manner, and the adoption of a cynical approach by seeking to make the cardholders' choices less straightforward."The court ruling also disclosed the balance sheet and income position of GE Capital in 2013:• finance income of A$597.6 million• retained earnings of $385. 7 million• net profit of $122.4 million• total equity of $1.31 billion• total assets of $3.8 billion, and• total liabilities of $2.5 billion.In a briefing last year GE Capital said it earned "aggregated net income" in the year to December 2012 in Australia of $552 million.