Madoff whistleblower Harry Markopolos is probing GE on behalf of a hedge fund — but he won't say which one.

"I can't — I promised confidentiality," Markopolos told CNBC's "Squawk on the Street" Thursday. "It's a mid-sized, U.S. based hedge fund."

Markopolos said it was "their request," not his, and that he was getting a "decent percentage" of profits that the hedge fund would make from betting against GE.

The anonymous hedge fund paid Markopolos to research and publish a 175-page report earlier, which alleges that GE has been hiding the extent of its accounting issues through false statements. The report outlines a "long history" of accounting fraud, dating back to as early as 1995, when it was run by Jack Welch.

Markopolos said the alleged insurance fraud was "bigger than Enron and WorldCom combined." He claimed the company has committed $38 Billion in fraud, amounting to more than 40% of GE's market capitalization. Shares of GE closed 11% lower Thursday in its biggest drop in 11 years.

"It's going to make this company probably file for bankruptcy," Markopolos said. "Worldcom and Enron lasted about 4 months ... We'll see how GE does."

In response to the report, GE said "the claims made by Mr. Markopolos are meritless."

"The Company has never met, spoken to or had contact with Mr. Markopolos, and we are extremely disappointed that an individual with no direct knowledge of GE would choose to make such serious and unsubstantiated claims," GE said in a statement Thursday. "GE operates at the highest level of integrity and stands behind its financial reporting. We remain focused on running our businesses every day, following the strategic path we have laid out."

Markopolos's case centers around GE's long-term care insurance unit, which the company had to boost reserves for by $15 billion last year. By examining the filings of GE's counterparties in this business, he alleges that GE is hiding massive losses that will only increase as policy-holders grow older. He claims that GE has filed false statements to regulators on the unit, or eight other insurance regulators have done so. Separately, he goes on to find issues with GE's accounting on its oil and gas unit Baker Hughes.

When asked why GE analysts didn't see this coming, Markopolos said "the difference is I'm a certified fraud examiner."

Long-term care policies typically deal with end of life costs, like nursing homes or assisted living and are known as one of the more costly and unpredictable parts of the insurance market — especially as the average American lifespan rises.

Last January, GE reported a $6.2 billion charge based on liabilities in its long-term care business, which is run by the company's financial services unit, GE Capital. To make up for the costs, GE Capital said it needed to set aside $15 billion to hold against potential losses, and stopped paying a dividend to its parent company for the "foreseeable future."

GE is already under investigation by the Justice Department and SEC for potential accounting practices. That includes a $22 billion charge the company took in the third quarter related to acquisitions made in its power business.

Markopolos said he began questioning GE's accounting as early as the 1990's. But after the company completed a move to Boston, he said it became a "personal interest."

"When you move to my hometown and you're running a scam, I'm going to come after you," he said.