I am still amazed by how many people think Martha Stewart is being prosecuted for “insider trading.” She’s not.
I don’t know the exact legal term (securities fraud, maybe), but here is what she is accused of:
Martha Stewart made statements to reassure investors and potential investors in her company that she did not sell ImClone shares with insider knowledge. The effect of such statements was to prevent her company’s shares from being sold. Her statement was a lie intended to deceive shareholders and potential shareholders.
That about sums up the prosecution’s case. I think it is frivolous and stupid. I would not think that, had the prosecution charged Martha with breaching “insider trading” laws, but they didn’t. So, they are saying she lied by her saying she sold shares without insider knowledge, i.e. she must have had inside knowledge, otherwise it would not have been a lie. But, they won’t charge her with that.
Dumb and ego driven.