By Alwyn Scott and Jonathan Stempel
NEW YORK (Reuters) - General Electric Co was sued on Friday by a shareholder who accused the conglomerate of concealing mounting insurance liabilities and a U.S. Securities and Exchange Commission probe, costing shareholders tens of billions of dollars.
The complaint filed by the Cleveland Bakers and Teamsters Pension Fund appears to be the first proposed shareholder class action accusing GE of securities fraud since the company surprised investors with two negative announcements last month.
On Jan. 16, GE said it would take a $6.2 billion pretax charge and set aside $15 billion in reserves to help cover insurance operations held by its GE Capital unit, mainly concerning long-term care insurance policies.
Eight days later, it said the SEC had begun probing how it handled its insurance obligations, as well how it accounted for service agreements related to power plants, jet engines and other equipment.
The lawsuit also names as defendants Chief Executive Officer John Flannery, his predecessor Jeffrey Immelt, Chief Financial Officer Jamie Miller and her predecessor Jeffrey Bornstein.
GE had no immediate comment on the defendants' behalf. Daniel Berger, a lawyer for the plaintiff, did not immediately respond to requests for comment.
The lawsuit seeks damages on behalf of shareholders from Feb. 26, 2013 to Jan. 24, 2018.
GE's market value fell to roughly $143 billion by the end of the class period from more than $290 billion in July 2016.
The Boston-based company has faced earlier shareholder lawsuits over its falling stock price.
Long-term care insurance has become a more troublesome and costly business, including for the Genworth Financial Inc business that GE spun off in 2004, as policyholders live longer and their medical expenses rise.
The complaint said GE knew or should have known it was not immune from that trend, and quoted from analysts covering GE who wrote that it was "hard to believe" or "hard to imagine" that the company suddenly discovered its problems.
GE stopped writing long-term care insurance contracts in 2006, but has said it provides reinsurance on about 300,000 policies.
The case is Cleveland Bakers and Teamsters Pension Fund v General Electric Co et al, U.S. District Court, Southern District of New York, No. 18-01404.
(Reporting by Alwyn Scott and Jonathan Stempel, Editing by Franklin Paul and Tom Brown)