Martha Stewart

Stock trade scandal

Background Information

• American business woman

• Television talk show host

• Author and magazine publisher of Martha Stewart Living.

• Voted America’s 3rd most powerful woman in 2001 by Ladies Home Journal.

Family Life

• Martha Stewart attended Bernard College in New York where she met and soon after married her husband Andrew Stewart.

• The two had their only child, a daughter named Alexis, in 1965

Beginning of the Scandal

• Stewart had invested a large sum of her money in her father’s ImClone company stock.

• In December 2001, Stewart receives inside information to sell her ImClone stock

2002

• Sam Waskal, ImClone founder and Martha Stewarts father, is arrested in June of 2002 and charged with insider trading.

• In October 2002, Waskal admits to tipping his daughter Martha and also admits to trying to sell his own shares.

2003

-In June 2003, Stewart resigns as chairwoman and CEO of her company however keeps her position as chief creative officer and a board member.

-Not long after Stewart claims her innocence and tries to save her name along with her reputation.

-Waskal is sentenced to 7 years in prison.

2004 Court Case

• Stewart is charged with 5 convictions, one of which including a securities fraud count.

• Stewart is found guilty on all charges and her stock broker, Bacanovic, is convicted for all but one of Stewarts charges, making a false statement.

Punishment

• Lucky for Stewart, she is let off easy and is sentenced to 5 months of detention in her home in suburban New York.

• This is not a normal sentence. She most likely received this sentence because of her name.