Feds Seek Indictment Against Martha Stewart

AP | June 3, 2003

[Happy2BMe]

The Associated Press
Tuesday, June 3, 2003; 8:28 AM

NEW YORK - Federal prosecutors are seeking a criminal indictment against Martha Stewart "in the near future," her media company said Tuesday.

Stewart has been under investigation on suspicion of insider trading involving shares she sold of biotech company ImClone Systems Inc. in December 2001.

The statement from Martha Stewart Living Omnimedia Inc. said Stewart's attorneys told the company that Stewart is the target of a criminal investigation by the U.S. Attorney's office for the Southern District of New York and that a civil complaint by the Securities and Exchange Commission also is expected.

The statement didn't elaborate on the possible charges.

The company said its board of directors has been planning for a number of possible contingencies, is evaluating the current situation and will take action as appropriate.

Federal authorities are investigating Stewart to learn if she sold ImClone shares because she had insider knowledge that the Food and Drug Administration was going to reject the company's application for its new colon cancer drug. Stewart has denied any wrongdoing in her ImClone sale.

A message left with Stewart's attorney before office hours was not immediately returned.

The U.S. attorney's office had no immediate comment when reached Tuesday morning.

© 2003 The Associated Press

[Happy2BMe]

Does this mean K-Mart won't be selling her dinnerware anymore?

Will my wife get a refund on her subscirption to Martha's magazine?

Oh my!

[mewzilla]

It's a good thing.

[Cicero]

I don't much like Martha Stewart, who was a clinton shill. But this troubles me. With all the cheats and crooks out there in the financial industry, this is a pretty minor case. She was not trafficking in her own stock, and she is not a professional trader or broker.

She had a tip from her boyfriend and she sold. Technically it's insider trading, but it was more of an impulse than a deliberate crime.

I don't think they would be going after her like this if a)she weren't such a high-profile celebrity; and b) she were one of the real high-powered financial crooks with political connections. Those guys just get slaps on the wrist.

They should settle this for a fine and a reprimand. She's already paid big time for this stupid mistake. As I said, it's not because I like her, but because I just don't see this as a major financial crime.

[blackdog]

MS will never see a day in prison. The feds will just motion, threaten, twist, and point, providing a continuous revenue stream to law firms, fines for federal prosecuters off budget books, and plenty of campaign contributions in the spirit of buying an "out of jail" card from politicians.

Once Martha is tapped out, ruined, and has not even two dimes to rub together, she will vanish like a designer fart in the wind, never to be mentioned in print or screen again.

[mewzilla]

Minor but visible. Trust is the coin of the realm. The small investor needs to be reassured that the authorities will do the best they can to ensure the game isn't rigged. Book her, Dan-o.

[Happy2BMe]

"I don't think they would be going after her like this if a)she weren't such a high-profile celebrity; and b) she were one of the real high-powered financial crooks with political connections. Those guys just get slaps on the wrist."

In "normal" times, I would be agreeing with you 100%.

But, these are not "normal" times.

Picture the scenario if instead of it being Martha, it were a conservative public celebrity (pick one).

And instead of John Ashcroft being the Department of Justice Chief, it were a Democrat whig.

How say you to that?

[SarahW]

ANd if she hadn't arrogantly lied her ass off about it....

[Zavien Doombringer]

This is Vey Series!

[katze]

Don't forget about Leona Hemsley, and she may not be a Liberal.

[blackdog]

But you don't get it.....

While my assets for retirement shrunk at the margins from $over $500,000 down to less than half of that, the Martha Stewart's of this world were not operating within those same free market rules that the rest of us peasants enjoy.

The brokerage firms, investment banks, and fund managers had insider knowledge that afforded them time and information to nail their feet to the roof while the rest of us tumbled in free fall. They did this at the expense of others using information and regulation manipulation that is against the law.

Actions have consequences and Martha loved action.

[Happy2BMe]

"This is Vey Series!"

Series - but not hugh.

The zeal over protecting our stock exchange is series, but protecting our borders is hugh!

If only our gubberment would lose the political correctness long enough to correct even one of these problems (corruptness in the money market ~or~ protecting our borders from the illegal invasion).

Sigh

[MeekOneGOP]

The statement from Martha Stewart Living Omnimedia Inc. said Stewart's attorneys told the company that Stewart is the target of a criminal investigation by the U.S. Attorney's office for the Southern District of New York and that a civil complaint by the Securities and Exchange Commission also is expected.

The statement didn't elaborate on the possible charges.

Well, I've been wondering what took so long. Somebody having to get their ducks lined up, I'm sure !!

[MeekOneGOP]

Your comment in #1: Will my wife get a refund on her subscirption to Martha's magazine?

The magazine posted in #12 will replace that one ! :O)

[mr.pink]

She was not trafficking in her own stock, and she is not a professional trader or broker.

I'm not sure of the specifics, but she had some relationship with the NYSE/SEC that required her to operate in an impecable manner. Other FReepers who are in the "biz" can explain the particulars and ramifications of her actions.

As finnacial crimes go, I agree she's small potatoes, but she's a potatoe none the less, and a rotten one.

[eureka!]

"She was not trafficking in her own stock, and she is not a professional trader or broker. She had a tip from her boyfriend and she sold. Technically it's insider trading, but it was more of an impulse than a deliberate crime. "

I understand she had a broker license. She knew what she was doing. Then she lied about it and joined a conspiracy to obstruct the investigation. The feds flipped the broker and here we are. Were it you, you would be indicted too. As to the amount, it was hundreds of thousands of dollars. Not peanuts, even if MS was worth ten times that. Rat or Republican, she is worthy of more than a simple fine. Just MHO, mind you......

[Eric in the Ozarks]

You nailed it blackdog. I'm down (not as much, but still painful) and it would have been nice to have had an inside tip to switch out of stocks and into to bonds in the spring of 1999...

[Happy2BMe]

"The magazine posted in #12 will replace that one ! :O)"

Money does so very much corrupt!

Poor Martha - poor, poor Martha.

Will she be a celeb and loved, cherished, and coddled in prison?

Will other inmates asking for autographs on dining hall napkins and lining up to volunteer for kitchen work?

So sad Hillary couldn't join her.

[YOMO]

Hey Martha,
Come over here and kiss your husband Leona good night.

[MeekOneGOP]

"So sad Hillary couldn't join her."

Yup !

http://home.attbi.com/~mrgrumman/HillaryTissue.jpg

And maybe Terry McAwful too !

http://home.attbi.com/~mrgrumman/McAuliffeTissue.jpg

[mass55th]

" and she is not a professional trader or broker."

But she was a professional broker prior to her rise to fame, and she did lie to investigators, which means she more than likely signed a sworn deposition/affadavit. If you think she should be allowed to walk away, then you might as well state that Clinton should have been allowed to escape impeachment because all he did was lie under oath. The fact is that there was a plea offer, but it didn't work out. So, she can face the consequences like everyone else. She shouldn't be allowed to skate simply because of who she is, or because there are bigger and badder cheats out there. Quite possibly, this wasn't Martha's first attempt to get a one-up on the market, nor would it have been her last had she gone undetected. Chances are once this is behind her, she'll think twice before committing a similar crime. It's called a deterrent sentence in hopes of impressing upon her and others the necessity of following the laws, and the consequences to those that don't.