Posted on 07/26/2002 6:32:48 PM PDT by white trash redneck
- Federal prosecutors believe Ms. Stewart and Dr. Waksal, close friends who share a stockbroker, also shared information about ImClone, the company Dr. Waksal ran before stepping down and being arrested on insider trading charges.
Prosecutors allege Dr. Waksal told his father and one of his two daughters they should sell stock in the company because the Food and Drug Administration would be announcing they were denying an application by ImClone to proceed with the cancer drug Erbitux.
Prosecutors planned to indict Dr. Waksal last week but changed course at the last minute when Dr. Waksal’s lawyers reportedly said their client was willing to discuss a possible plea bargain.
Sources said Dr. Waksal — who had maintained that he is innocent and any evidence against him is circumstantial at best — made the decision after prosecutors told his daughter, Aliza, they had enough evidence to indict her as well.
The sources added that Dr. Waksal — concerned that his father and other daughter would also face charges — sent a message that he would be willing to plead guilty to insider-trading related crimes if the government was willing not to pursue charges against the other members of his family.
Despite his willingness to discuss cooperation, Dr. Waksal, according to these sources, was concerned that federal sentencing guidelines would require him to spend a minimum of seven years in prison. The only way he could plead guilty and see his sentence reduced would be to offer the government information it could use.
As a result, according to sources familiar with negotiations, Dr. Waksal sent word to investigators that he would tell all he knows.
“He wants to protect his family,” one source familiar with the negotiations said. “He doesn’t want to see them hurt any more.”
Sources cautioned that the talks could fall apart.
But if Dr. Waskal is able to reach a plea agreement it could spell trouble for Ms. Stewart, who has maintained she did nothing wrong.
Prosecutors are particularly interested in what Dr. Waksal can say about the actions of Ms. Stewart, their broker Peter Bacanovic, and his assistant, Douglas Faneuil.
Federal investigators are trying to determine if Ms. Stewart was acting on information provided by Dr. Waksal when she sold her 4,000 shares in ImClone on December 27 — the day before the FDA rejected the Erbitux application.
Prosecutors expect that if Dr. Waksal cooperates, he will explain what Ms. Stewart and Mr. Bacanovic knew about the problems of ImClone and when they knew it.
Prosecutors say they know there was communication be- tween the three that day concerning the stock.
Federal law enforcement sources said prosecutors are trying to determine whether Ms. Stewart obstructed justice or lied to investigators.
Prosecutors believe that Mr. Bacanovic may be the key. And they’re not the only ones.
Congressional investigators yesterday received Mr. Bacanovic’s home and cell phone records.
They previously received his office phone records and trading logs.
A lawyer involved with the investigation said Dr. Waksal’s willingness to cooperate will put pressure on the others to step up to the plate.
“It’s almost like musical chairs,” the lawyer said. “There’s a certain amount of potential defendants all trying to get cooperation agreements. Eventually, the music will stop and someone will be left standing.”
Representatives of Dr. Waksal, Ms. Stewart, Mr. Bacanovic, and Mr. Faneuil had no comment on the negotiations.
A spokesman for the United States Attorney for the Southern District of New York also declined to comment on the talks.
That's a good thing.
That's a good thing.
It's a good thing to let off a whole damned corrupt family in a trade for Martha Stewart? I don't think so.
In addition, a fundraiser for democrat senatorial candidates was only cancelled because of the insider trading charge.
She is a soldier in the army of the left, and I feel no pity.
The sources added that Dr. Waksal — concerned that his father and other daughter would also face charges — sent a message that he would be willing to plead guilty to insider-trading related crimes if the government was willing not to pursue charges against the other members of his family.
My thoughts exactly....I've always thought that Martha Stewart was somewhat of a red herring in this whole matter. She may have done some insider trading, but nothing to the extent that the owner's family did.
Poetic justice, except for the fact that they ALL should be dressed in day-glo orange and do the perp walk.
Slime, they are all slime.
Re Waksal....whatever jail time he gets..he's facing disgorgement of one hundred million or so..that where it gets interesting....he owed the banks and brokerages a ton of money..he'd borrowed against the stock to support his lifestyle..when it cratered, he couldn't pay the loans....it hasn't been stated what he did with the money that his father and daughers got from their sales..if they gave it to creditors, the govt can force disgorgement.....this a rticle sounds like it's defense spin, to me....
Perhaps Martha can strike an agreement as well.
The scam is nearly perfect. A promoter promotes a cancer cure. He files with the FDA. Then he promotes the stock in his cancer cure firm. Then sells out before the FDA rules the drug is not going to be approved.
The rules for drug approval are clear. No one files not being certain that a the drug will be approved. If it does what is claimed it will be approved. What makes it perfect is the difficulty in proving that the person who applied for the drug approval knew it would be turned down. It is one of the better cons.
Can you imagine someone selling his ownership of a drug that cured cancer before it is approved? That ranks right up their with the guy who will sell his machine that makes dirt into gold. It the machine worked he would just use it to make gold and sell the gold. If someone really had a cancer cure he would not sell ownership before approval.
Nearly 5 years ago I was diagnosed with terminal lung cancer. What would I have paid for a drug to cure it? Everything I had or could get my hands on. My cancer was cured, and it cost a fortune. But I would have paid all I had for a cure.
But I can't imagine anyone selling ownership in a cancer drug before it was approved. Once approved it wouild bring a huge amount of money. There is a huge value difference between a drug that migh work and one that does.
The only reason to sell before is the same reason the guy wants to sell the machine that turns dirt into gold. It is a fake machine and a fake cure.
That is why they are after him, and that is why they are after Martha.
Martha is terminal stupid. All she had to do was sell the stock and deny insider information. She could say I heard it had fallen to Sixty bucks a share so I sold. Instead she tries to use a fake standing sell order and gets caught.
Martha is likley to mostly be a slightly dishonest dumb broad. If she had been bright she would have called the broker in a panic noting that the price had fallen. She would have been shocked and frightend. She would have ordered the sale after vasilating a bit and finally deciding to sell telling the broker that if it started back up she would buy again. She would have a broker that could testify she kept asking me what to do... I didn't tell her.
She is not a very smart crook but her boyfriend is a pretty good con artist. He sold a machine that he claimed would make gold out of cancer. He got paid in gold.
I agree, get'em all!
How likely is it that they would find the people who
bought the stocks which are now worth so much
less and reimburse them? Does that ever happen?
I didn't think so. Off to the hoosegow.
IMO, everyone who doesn't play by the same rules as the "commoners" deserves to take a hit, as appropriate, political party notwithstanding. Too often, the "priveledged" get off the hook. Witness: the Clintons, The Goron, Toricelli, etc., etc.
Of course, it will be tastefully appointed with accessories made from paper plates from the prison cafeteria.
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