In these days of corporate scandals and wrongdoing, it is always nice to see the bad guys taken down from their pedestals. Kenneth Lay of Enron, Scott Sullivan and Bernard Ebbers of WorldCom are just a few. Most recently, we have been hearing Martha Stewart’s name among the wrongdoers of the worst kind.
The government had originally charged her with stock fraud, for selling her stock of ImClone before it lost money. But this main charge was dropped because of a lack of evidence. Secondary charges against her included, obstruction of justice, false statements, and conspiracy to obstruct justice.
When looking at the main charge of stock fraud the secondary charges make sense. Of course anyone who is charged with stock fraud is going to do what they can to stay out of jail. However, when the primary charge is dropped, these secondary charges are ridiculous.
In truth the only thing that Martha Stewart did wrong was maintaining her innocence throughout the entire case against her. “I have done nothing wrong, I believe in the fairness of the judicial system and remain confident that I will ultimately prevail.” (U.S. News & World Report 3/15/04 “Not a Good Thing”) This is what the federal government calls an “obstruction of justice.” By sticking by her word that she did nothing wrong, the government went ahead and has spent 10 million dollars of our taxpayer money to make sure Stewart went to jail even though there was no case against her.
Business Weekly associate editor, Diane Brady commented that, “The Securities & Exchange Commission has a powerful arsenal....[but] using the criminal justice system to make the point -- or to deter others -- is overkill.” If she had done something wrong the SEC could have fined her or kept her from serving as a director of a public company. Why go to the criminal court system?
Is this an instance where a powerful woman gets taken down where powerful men do not? A N.Y. Post reporter commented, “Nothing infuriates a jury like a woman who refuses to cry, to cave, to kneel before them.” While no feminist myself, it might be something to think about.
Another point to consider is the damage that has been done to the American public. Very little. Enron changed their books to show that they were making more money than they were in reality. Kenneth Lay and the bigwigs of Enron even looted their own company. Billions of dollars were lost by shareholders of that company. And hundreds of jobs along with it. Quoted in Business Week, Thomas Dewey, a securities litigator said, “It is hard to see what harm has been visited on people by her actions.”
The case against Martha Stewart from beginning to end was an opportunity by the Federal Government to make an example of someone rich and famous. There is nothing more to it. Unfortunately, the American public is cheering. So much for justice.
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