I believe Martha is guilty on insider trading as a "tipee". The NASD
should be investigating. Punishment is jail and heavy fines.
Posted on 06/24/2002 4:18:56 AM PDT by kattracks
It could get really ugly today for Martha Stewart.Stewart — who looked chunky and very un-Martha-like in the Hamptons over the weekend — faces a new pounding of her financial empire in the stock market.
Stewart's broker was suspended by Merrill Lynch late Friday after the market closed — and experts say her company's stock could now fall even more than it has so far in the ImClone scandal.
"The stock price is reacting to the news — these headlines are not going to make the stock go up," Michael Holland, president of the money management firm Holland & Co., told the Daily News.
"No one knows how much it'll go down," Holland said.
There were early indications in after-hours trading Friday that her Martha Stewart Living Omnimedia stock could plummet after the news about the suspension of her broker, Peter Bacanovic.
Stewart kept an unusually low profile at her East Hampton, L.I., home over the weekend, but she did make time to look for a few good things at an outdoor antiques show.
Her hair uncoiffed, she wore sunglasses, a straw hat and a T-shirt. She had a Windbreaker tied around her waist.
She fled the weekend retreat on Lily Pond Lane shortly before noon yesterday as the press waited outside. Hiding in a black Chevy sport-utility vehicle, she was driven to the airport and chartered a plane to Bridgeport, Conn.
Her spokeswoman declined to comment on the investigation or Stewart's weekend plans.
Broker May Testify
Meanwhile, questions continued to swirl around the activities of Bacanovic, who is expected to testify before the House Energy and Commerce Committee investigating the ImClone controversy.
Sources say he was suspended by Merrill Lynch after the company found evidence that contradicted Stewart's claims about the sale of her ImClone stock.
"He's the one that's either going to blow this thing wide open or put it to bed in terms of Martha Stewart," committee spokesman Ken Johnson told Newsweek.
A meeting scheduled this week with Bacanovic has been rescheduled as he seeks new counsel, according to Johnson.
Congressional investigators revealed they also will focus on Stewart's close friend, Dr. Bart Pasternak, who sold 10,000 shares of ImClone around the same time she did.
Stewart was en route to Mexico with Pasternak's estranged wife, Mariana Pasternak, when she phoned Bacanovic to sell her shares. She also tried to reach ImClone founder Sam Waksal, who was arrested June 12 on insider trading charges.
Johnson said committee members had interviewed Bart Pasternak and were trying to meet with his wife.
ImClone stock plummeted after a Dec. 28 announcement that the government had rejected its new anti-cancer drug.
Stewart — who sold her stock the day before — insists she had no insider information and had instructed Bacanovic to sell if the stock fell below $60 a share. It went down to $58 the day she sold.
Since the scandal, Martha Stewart Living Omnimedia stock is down a total of $3.26 — which translates into an overall loss of more than $100 million for Stewart, who owns 31 million shares.
But then, right about now, everything is down. *sigh*
I believe Martha is guilty on insider trading as a "tipee". The NASD
should be investigating. Punishment is jail and heavy fines.
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