As the stock market plummeted this summer and fears of a double-dip recession began to surface with continued slow economic numbers, investors and the public started to look for something, or someone to take their frustrations out on. This movement led the public to focus on corporate wrongdoing. The media seemed to focus its unrelenting eye on this issue, as it became the hot topic for almost any news show.
Executive after executive was brought up on charges having to do with "interesting" accounting practices, such as Bernie Ebbers of WorldCom, Dennis Kozlowksi of Tyco, Martha Stewart... Martha Stewart? Stewart is on the verge of being brought up on charges of insider trading (trading securities on non-public information) and obstruction of justice. Stewart is being accused of selling her 4,000 shares ImClone on inside information that the FDA was going to rule on ImClone's latest drug, Erbitux obtained through conversation with ImClone CEO Samuel Waksal or other ImClone officials. To make matters worse, Stewart then may have lied about the circumstances surrounding her sale of the stock to the SEC (Securities and Exchange Commission) in an attempt to save herself.
It may just be me, but it seems a little strange that Martha
Stewart is being accused of these crimes. When I think of Martha Stewart,
I think of this woman on the television either planting something in an
already perfect garden or in a kitchen making something that looks so
good, so exquisite that if it were made of manure I would still eat it.
Thousands of people around the country try to replicate what she does
in the home and garden. Martha Stewart isn't exactly the type of person
that comes to mind when I am thinking of insider trading and obstruction
of justice. When I think of insider trading, I think of, for example,
the Oliver Stone movie Wall Street, where some hot shot investor is taken
down on insider trading violations. I do not tend to think of a woman
that has her own home and garden show.
Maybe I shouldn't be as perplexed by this whole situation
as I am. After all, Stewart is the chairman and chief executive of her
own company Martha Stewart Living Omnimedia, Inc. However, I do believe
she is known more for her ability around the house than her ability in
a board room.