Here are the governments charges against Martha Stewart and former stockbroker Peter Bacanovic:
Charges against Stewart:
Conspiracy
Alleges Stewart and Bacanovic “willfully and knowingly” worked together to obstruct justice and make false statements in the stock-trading scandal.
False statements
Alleges, among other things, Stewart lied when she told the Securities and Exchange Commission, FBI and federal prosecutors she had prearranged with Bacanovic to sell ImClone when it fell below $60 per share.
Alleges, among other things, Stewart lied when she told the SEC, FBI and prosecutors that she did not recall being told on Dec. 27, 2001, that the Waksal family was selling ImClone stock.
Obstruction of justice
Alleges that, from January to April 2002, Stewart “willfully and knowingly” tried to hamper the SEC investigation of her stock sale by providing misleading information.
Securities fraud
Alleges Stewart “well knew” her personal reputation was critical to shareholders in her company, Martha Stewart Living Omnimedia. Alleges she made misleading public statements in June 2002, after news of her ImClone sale broke, that she intended to “defraud and deceive” her investors.
Charges against Bacanovic:
Conspiracy
Alleges Stewart and Bacanovic “willfully and knowingly” worked together to obstruct justice and make false statements in the stock-trading scandal.
False statements
Alleges Bacanovic lied when he told regulators he had had a conversation with Stewart in which she decided to sell ImClone when it reached $60 per share. Also alleges he lied about a Dec. 27, 2001, conversation in which he told Stewart the stock price had dropped.
Making and using false documents
Alleges Bacanovic altered a worksheet of Stewart’s portfolio to make it appear he and Stewart had prearranged to sell ImClone when it fell below $60.
Perjury
Alleges Bacanovic lied repeatedly in a Feb. 13, 2002, interview with SEC investigators, particularly about his conversations with Stewart in the weeks surrounding her sale of ImClone stock.
Obstruction of justice
Alleges that, from January to April 2002, Bacanovic “willfully and knowingly” tried to hamper the SEC investigation of Stewart’s stock sale.
Penalties
The maximum penalty for each count is five years in prison and a $250,000 fine, except for the securities fraud count against Stewart that carries 10 years in prison and a $1 million fine. If convicted, both are likely to get far lighter penalties than the maximum under federal sentencing guidelines.
