Welcome to Scribd, the world's digital library. Read, publish, and share books and documents. See more
Download
Standard view
Full view
of .
Save to My Library
Look up keyword
Like this
7Activity
0 of .
Results for:
No results containing your search query
P. 1
Martha Stewart

Martha Stewart

Ratings:

4.0

(2)
|Views: 1,694 |Likes:
Published by hatanolove

More info:

Published by: hatanolove on Jun 28, 2008
Copyright:Attribution Non-commercial

Availability:

Read on Scribd mobile: iPhone, iPad and Android.
download as DOC, PDF, TXT or read online from Scribd
See more
See less

11/18/2010

pdf

text

original

 
Case: The Trial of Martha Stewart
Martha Stewart started her career in 1976. In ten years her business, which sheran out of the small of her business, had become a $1 million enterprise. She is into aone-woman industry. She is a popular American television and magazine personalityknow for her cooking, gardening, etiquette, and arts and crafts projects, and as a generallifestyle guide and homemaker. Over the year, Martha Stewart has show patience andgood humor in the face of the criticism and satire. However, she was confronted with afar greater challenge in 2003, an investigation of her personal stock trading by the JusticeDepartment and the Securities Exchange Commission. Starting in 2002 her career wasrocked by a scandal involving her sale of shares in a drug company days before itsapplication for a new drug was denied. She was eventually convicted of lying toinvestigators and sentenced to prison in 2004
.
The government says Stewart has been involved the crime of insider trading. Shesaved the money by selling stock in ImClone Systems on Dec. 27, 2001. It was just before a negative government report about rejecting the Erbitux (new colon cancer drug)application. It was insider information because it was not yet known to the public.Although Stewart says she sold because she and Bacanovic, her Merrill Lynch & Co. broker, had a pre-existing agreement to sell when the stock fell to $60, the governmentstill says she was tipped that ImClone founder Sam Waksal who were close friend had been introduced by Stewart’s daughter Alexis was trying to unload his shares.The U.S. Attorneys and the Securities and Exchange Commission indictingMartha Stewart sold ImClone after a “secret tip” from Bacanovic that the Waksals were
 
selling. Then, she and Bacanovic tried to cover it up. The two were charged withconspiring to conceal evidence that Bacanovic had provided nonpublic information aboutImClone to Stewart. And they were accused of lying to government attorneys to hamper their investigation. Moreover, Under questioning by attorney, Faneuil who was on dutyat the mid-Manhattan office of Merrill Lynch during Martha Stewart sold her shares, heindicated that Bacanovic asked him to break the client information privacy policy, thenlet Faneuil, who told Martha Stewart that Sam Waksal and his daughter had sold all of their shares. Merrill Lynch protects the confidentiality and security of client information.Employees may not discuss the business affairs of any client with any other employee.However, Bacanovic told Martha Stewart a big tip for the shares sold. Therefore, prosecutors are unconsciously to indict Marthan Stewart base on evidence of a serouscrime in this case. Martha Stewart was charged with securities fraud. She had made aseries of false statements about her innocence to mislead investors and prop up her company’s share price.I agree with the jury that she was guilty beyond a reasonable doubt of theconspiracy and obstruction of justice charges. The jury deliberated for 14 hours over three days. On March 5 the verdicts were announced that Stewart and Bacanovic wereeach found guilty on four counts of lying and conspiring to lie to conceal the fact that shehad been tipped with insider information. However, the jury disagree that thegovernment had proved beyond a reasonable doubt it allegation that Stewart andBacanovic fabricated the $60 sale agreement and it acquitted them on those counts.Stewart was not indicted on the original charge of insider trading, but only for thecoverup that ensued, it is because she had a standing order with Bacanovic to sell her 
 
shares if ImClone stock fell below $60. In addition, jurors also found Faneuil credibleand gave much weight to his testimony. Ann Armstrong was also an important witness because she cried and they felt cynical about Stewart hiring a criminal defense lawyer even before she was contacted by government investigators.Martha Stewart and Peter Bacanovic were sentenced appropriate that eachsentenced to five months in prison, five months of home confinement, and two years probation, for lying about a stock sale, conspiracy and obstruction of justice. Stewart wasordered to pay a $30,000 fine, while Bacanovic was fined $4,000. Furthermore, Faneuilcut a deal with prosecutors, in which he pleaded guilty to one misdemeanor count inexchange for his testimony. Though he entered his plea in October, his sentencing is notslated until June. Faneuil at length about the specifics of his agreement with thegovernment, focusing on the fact that prosecutors agreed to send a letter to the judgesentencing him after his testimony is complete. Without such a letter from prosecutors,the judge would have little flexibility to give Faneuil a sentence without jail time.Eventually, from indictment to sentencing, the case of Martha Stewart was amatter of intense public interest. Some thought that Martha Stewart has had moreinfluence on how Americans, eat, entertain, and decorate their homes and gardens thanany one person in our history. Her story is miraculous.In conclusion, Truth is attainable in business and many accomplish it throughhonesty and integrity. Unfortunately, there are many commit fraud in the business world.It is important that everyone should know business ethics that is the study of good andevil, right and wrong, and just and unjust actions in business. A mass of principles,

Activity (7)

You've already reviewed this. Edit your review.
1 hundred reads
1 thousand reads
Amber Drakes liked this
Amber Drakes liked this
Erick Arnold liked this

You're Reading a Free Preview

Download
/*********** DO NOT ALTER ANYTHING BELOW THIS LINE ! ************/ var s_code=s.t();if(s_code)document.write(s_code)//-->