celadon, perhaps--Martha's favorite color!!!
So - are the big fishies just really hard to catch? or what...?
big fishies have bigger friends
So - you think they ain't really trying?
We have had a few corporate bosses "go" over here who had big friends - sometimes "go" meant overseas, of course...
I guess I need to change my avatar, apparently nobody reads what I post:
Quote:Here's how it worked: About a month after Martha allegedly sold her ImClone stock on insider advice, she had her assistant go into the phone log and erase the notation for a conversation with her stock broker from the key day it happened. Investigators, she thought, would now see December 27, 2001 and think she simply spoke to the broker. Gone was the description of him telling her to sell the stock because Waksal was also selling it off.
It's hard to understand how Stewart, who is a bright woman, thought this would never be traced. But it turns out to be the smoking gun in her case. Why would she have made the change if she had nothing to hide? At this point, one would hope that Stewart would change her plea to guilty and pay her fine. Dragging this case out only continues to harm her.
Can someone help me out with what part of this they are having a hard time understanding??????
Max,
We will wait together................................................................
What is the source of that quote, Maxsdadeo?
And, if true, how is that such a major crime that it deserves this much more attention than the other major white-collar crimes mentioned in this thread?
If the owner of a restaurant says the oysters are bad and need to be sent back to the vendor, and you hear them say this, are you going to sit there and say "oh, I didn't hear that" and eat the oysters or are you going to send them back and say that they smelled bad?
For those having a hard time understanding what others here have come to understand--Miss Stewart is not being prosecuted for insider trading. She is being prosecuted for a set of allegedly obstructionist actions on her part in connection with the investigation of that with which she is not being charged; additionally, she is accussed of securities fraud for publicly stating that she did not commit the crime for which she is now not being prosecuted. Stinks, from start to finish . . .
Well, now I'm all very confused. Securities Law and the SEC are a strange and complicated beast that I'd rather hide away from.
But I think Maxsdadeo is right (back on the third post of this thread). I do know that corporate officers and especially CEO's have to be *extremely* careful about what they say, to whom, and when. It is a constant preoccupation to not give subtle hints to the public, friends, or even family. It's usually best to shut up and say nothing at all.
Every public word has to be just so, or one may be accused of manipulating markets, deceiving by omission, swaying investors with false promises, and also the Ad Infinitum (That's Latin for, ah, lots more convincing stuff I can't think of right now but I would if I could).
Indeed, just look at all the disclaimers in any stock prospectus! Those are specifically there to keep the CEO out of jail. Full, fair, and equal disclosure to everybody.
These are very serious matters because millions of dollars are at stake, and the heart of capitalist society (our faith in the stock market) depends on the image of fair opportunity. No one would invest money in a market that doesn't seem fair! So we absolutely must "seem fair" to the public before scre... amortizing their investments across multiple fee structures. Faith is everything. Obey your thirst for money.
So basically, there's a very fine line between managing ones public reputation and manipulating the markets to keep ones stock high. A knowing deception is considered securities fraud, and Martha did lie. She ... betrayed the cornerstone of civilization.
I'm still looking for what Martha misrepresented to the public exactly, and how vocal the impact truly was. But I know every word counts here. It's extremely demanding of a CEO, and just one 5-minute lapse of judgement can spell doom.
Still trying to figure things out though... Ad Infinitum what all.
CodeBorg wrote:So basically, there's a very fine line between managing ones public reputation and manipulating the markets to keep ones stock high. A knowing deception is considered securities fraud, and Martha did lie. She ... betrayed the cornerstone of civilization.
She stated publically that she did not commit a criminal act of insider trading. The government are
not prosecuting her for insider trading--so how does that constitute a knowing deception, how is that a lie? Betrayed a cornerstone of civilization ? ! ? ! ? Oh please, get a grip.
If a CEO says we're doing just fine ... if ... then they are on the hook to justify it. Boosting their credibility against a growing threat could be considered manipulation.
We are talking about millions of dollars bought and sold based on a few paltry statements. It's ridiculously finicky stuff, but I've worked for a few companies going public where you have to be *extremely* careful.
If the NY Stock Exchange were full of liars and cheats, like junk bonds or the pink sheets, would you invest any money there? The SEC is charged with instilling confidence behind trillions of investment dollars! Is there a more important institution to the world of capitalism, than the NYSE?
Food for thought anyways. A well-publicized scapegoat could really help keep others in line....
From the New York times, which reprints an Associate Press story:
Quote:But it was the charge of securities fraud, placed near the end of the 41-page indictment, that surprised many legal watchers.
The charge cited a speech Stewart gave at an investors conference in New York on June 19, 2002, a week after ImClone founder Samuel Waksal, her longtime friend, was arrested on fraud charges.
In the speech, Stewart maintained her sale of ImClone had been perfectly legal, and that she was cooperating "fully and to the best of my ability with investigators."
Prosecutors say those were lies designed to pump up the stock price of her company. Martha Stewart Living Omnimedia rose more than $2, or about 14 percent, to $16.45 after her speech. The stock now trades at about $10.
"What the government is trying to suggest here is that this was not a victimless crime," Robert Mintz, a former federal prosecutor, said Thursday. "That is clearly the most controversial part of this indictment."
NY Times article here[/color]
Millions of dollars, huh? Yeah, her company's stock is now worth millions of dollars less than it was a year ago.
CodeBorg wrote:If the NY Stock Exchange were full of liars and cheats, like junk bonds or the pink sheets, would you invest any money there? The SEC is charged with instilling confidence behind trillions of investment dollars!
So, the SEC is pumping up investor confidence by going after Martha for a $45,000 scam, while Lay is not prosecuted after a multi-billion dollar crash at Enron, after the WorldCom bankruptcy has cost billions--oh yeah, i'm confident now, them boys is cleaning up the Street.
The government assembles a prosecution team:
The charges are controversial. I'm trying to piece it together myself. But far more than $45,000 is at stake. Martha Stewart Living Omnimedia (NYSE:MSO) closed on June 19, 2002 at 16.45, then one week later at 10.40. That's a loss of $300 million in one week.
If she said she didn't cover up nothing, but did actually cover up nothing, that could be a lie geared to boosting her company's stock. Controversial, but possible. Lies of any kind are not permitted, especially from an experienced businessperson!
So big bucks are at stake, not even counting investor confidence in the market and the economy. Securities fraud is fairly common but after Enron and WorldCom (and this incredible recession!) I bet the SEC is eager to restore investor confidence.
Economists are pretty scared right now, so any conviction will do, just get somebody publicized now! Just an idea ... makes some sense to me.
CodeBorg wrote:Economists are pretty scared right now, so any conviction will do, just get somebody publicized now! Just an idea ... makes some sense to me.
Ah, now there's a wonderful principle for government to use when making policy.
A great deal of the economy *is* about the show, just to sway human psychology. Without confidence, dire pessimism would continue to drag the economy further down. I certainly wouldn't buy a house or new car (or factory) until I'm pretty sure things are on the way back up. So the group consensus makes it so.
Plus, aren't many government policies already done just for show?
Airport security? What a laugh!
Reasons for war? Pick whatever sounds best.
Patriot Act? We're much more secure now!
War on drugs? Make 'em think we're fixing the problem.
It's not a very reassuring principle, but image-making and persuasion seems a good chunk of the governments occupation. With all the hype it seems Martha Inc. is being used, as some kind of example...
----------
""A good leader is one who can sense where the crowd is going and is fast enough to get in front." ... And then make a big show of it.
Setanta wrote: The government are not prosecuting her for insider trading--so how does that constitute a knowing deception, how is that a lie?
On the "Insider Trading" vs. "Fraud" thing - my guess is that it is just easier to get a conviction on Fraud. The way the law is written it doesn't take much to have have fraud involved in a stock transaction. Securities law lists fraud as "... any act, transaction, practice or course of business which operates or would operate as a fraud or deceit upon any person."
If they can't get a conviction with that definition then the SEC boys are in really bad shape. It's the catch-all charge.
http://law.freeadvice.com/financial_law/securities_law/insider_trading.htm
maxsdadeo
Quote:At this point, one would hope that Stewart would change her plea to guilty and pay her fine. Dragging this case out only continues to harm her.
It has been reported that she was going to plead guilty until she found out that pleading guilty would result in jail time.
I read the indictment, all 45 or so pages.
The government's case hinges on whether or not she tampered with her own phone log, whether she lied when she said she spoke to her broker while it was really his assistant, and the scientifically tested ink on a penned-in notation on her end-of-the-year work sheet doesn't match the rest of the scientifically tested ink.
I was shocked to read she'd sold most of her interest in IMCLONE two months earlier for a price in the low 70's. This last bit was a tiny portion of the original holdings.
If your broker tells you that the owner of a company is selling off shares in his company, so you sell your shares in it... that's against the law because it doesn't become public knowledge until the next day?
Piffka wrote:If your broker tells you that the owner of a company is selling off shares in his company, so you sell your shares in it... that's against the law because it doesn't become public knowledge until the next day?
From the link I posted above:
"In addition to the classic insider, such as corporate officers and directors, insider liability may be asserted against others who gain access to insider information, such as a person who receives a "tip" from an insider, attorneys, accountants and printers who have access to that information."
