Martha Stewart, Research Paper Example
Words: 662Research Paper
The Martha Stewart case had mixed reactions among the public: some people felt that her guilty verdict was fair because it was proof that everyone is treated equally under the law. Other people felt that she was being scapegoated, possibly because she was female, and that the verdict was unfair because she received a jail sentence whilepeople involved in larger financial scandals such as the Enron affair and other Wall Street firms that had clearly broken the law have never spent a day in jail. Indeed, some felt that the case was “a cautionary tale about the ever-expanding powers of federal prosecutors.” (Healy, 2004.) This paper will discuss Martha Stewart’s crime, the verdict, and the sentence she received, considering whether or not it was justified.
Martha Stewart was found guilty of conspiracy, making false statements and obstruction of agency proceedings that originated from the sale of her stock in a biotech company known as ImClone Systems Inc.; the sale had taken place in late in December, 2001. Ms. Stewart was not accused of insider trading, however, but rather, was being held responsible for charges that were connected to concealing data that was related to the sale of her stock as well as blocking the investigation into the matter. Ms. Stewart claimed that she sold her stock only because the price went below $60, an arrangement that she had made with her then-broker and codefendant, Peter Bacanovic (Richman, 2004.) The government’s case was based on the accusation that she had been warned that the CEO of ImClone was selling off his stocks, and that that precipitated her selloff.
It appears that the jury was heavily influenced by the prosecution’s star witness, Douglas Faneuil, the assistant to Bacanovic, who testified that his boss had ordered him to pass on the inside information about ImClone to Stewart (Stewart Convicted on All Charges, 2004.) This occurred despite the fact that Faneuil had a credibility issue when he admitted to lying in his initial interview with the Securities and Exchange Commission, leading to a misdemeanor and agreeing to cooperate by testifying against Stewart and his ex-boss (Ackman, 2004.) Ms. Stewart received the minimum sentence of four months in prison followed by four months of home confinement.
Martha Stewart should not have been sentenced to prison; she was not found guilty of insider trading, but rather, she received jail time because she lied to the investigators about her role in the ImClone stock sales. In actuality, she was not under oath when she spoke to the investigators, and it appears that the government was trying hard to turn the case into one that involved insider trading, when in fact, Ms. Stewart was not an ImClone employee. Nt seems ironic that she was imprisoned when large scandals that resulted in average citizens losing millions of dollars in the Enron and other Wall Street scandals did not result in anyone paying the legal price, or any price for that matter. In addition, as overcrowded as our prisons are, given that Martha Stewart did not represent a danger to the public, her spending any time in jail was a waste of taxpayer money. If she needed to be punished, she could have been put on probation or served her sentence at home, where she ended up spending the second four months of her term. Instead, she was treated like a common criminal, most likely in order to make an example of her to demonstrate that no matter how well-known, wealthy, or famous one is, they are still subject to the consequences of our legal system.
Ackman, D. (2004, March 5). Martha Stewart Found Guilty. Retrieved November 27, 2011, from Forbes.com:http://www.forbes.com/2004/03/05/cx_da_0305marthafinal.html
Healy, G. (2004, July 16). Lessons of the Martha Stewart Case. Retrieved November 27, 2011, from Cato Institute: http://www.cato.org/pub_display.php?pub_id=2740
Richman, S. (2004, March 10). The Martha Stewart Case: Where’s the Victim? Retrieved November 27, 2011, from The Future of Freedom Foundation: http://www.fff.org/comment/com0403f.asp
Stewart Convicted on All Charges. (2004, March 10). Retrieved November 27, 2011, from CNN Money: http://money.cnn.com/2004/03/05/news/companies/martha_verdict/
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