United States: Retired Jack Welch living large on General Electric's tab

Global Finance, Oct 2002 by Rombel, Adam

Jack Welch, the retired head of General Electric, is enjoying a fat cat lifestyle at GE's expense, according to his wife Jane.

She filed divorce papers in early September that paint a picture of previously undetailed extravagance that the company pays for as long as Welch lives.

Expenses that GE covers for Welch include use of an apartment in Manhattan, prime tickets to basketball and baseball games, tennis tournaments and the opera, a security detail and limousines, dinner tabs at a ritzy restaurant, satellite television at his several homes and, monthly use of a GE-owned Boeing 737.

Welch's wife says she can't place a value on most of those benefits, but estimates the monthly value of the GE-owned apartment overlooking Central Park at $80,000 and monthly use of the plane at almost $300,000. In the divorce filing, Jane Welch complained that her husband, who separated from her after beginning an affair with thenHarvard Business Review editor Suzy Wetlaufer, is paying her only $35,000 a month in living expenses-hardly enough to support the standard of living she enjoyed during their 13-year marriage.

The disclosures put GE and Welch on the defensive at a time when investors are particularly sensitive to lavish perks showered on corporate executives by companies such as Vivendi, Tyco and others. GE says Welch's retirement deal was unanimously approved by the company's board six years ago as an incentive for him to delay retiring and that it was "widely disseminated and discussed" as required by securities regulators. But current regulations don't spell out the level of detail required when disclosing retirement contracts. The Welches split earlier this year, two years after the expiration of their prenuptial agreement, which protected Jack's $900 million fortune. -Adam Rombel