Martha Stewart, the billionaire homemaker, with whose company – Martha Stewart Living Omnimedia (MSO) – Chrysler last April announced a “multimedia marketing programme”, is at the centre of a share-dealing scandal and facing questions over what investigators call “troubling inconsistencies” in her version of events.
According to a report from New York in the Daily Telegraph, “America’s domestic goddess” has been embarrassed by news that she sold 4,000 shares in a disgraced drug company called ImClone Systems a day before its “wonder” cancer treatment was rejected by watchdogs.
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The Daily Telegraph said that Stewart denies wrongdoing and claims she told her broker to automatically sell the shares if they dipped below $US60, as discussed in November.
Merrill Lynch stockbroker Peter Bacanovic, who handled the trade, told the newspaper he received instructions from his client in mid-December, not long before the questionable deal.
According to the Daily Telegraph, the congressional committee investigating ImClone could now subpoena documents from Stewart with a spokesman saying: “We are still in the ‘ask nice’ stage. But we are prepared in the next few days to make an official request. Clearly there are some troubling inconsistencies between published reports and what Ms Stewart’s lawyers have told us on several occasions.”
The newspaper reported that phone records show Stewart called Sam Waksal, then ImClone chief executive, shortly before she sold her shares, leaving a message saying: “Something is wrong with ImClone.”
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By GlobalDataWaksal was arrested last week and charged with securities fraud, the Daily Telegraph said, adding that police claim he alerted friends and relatives to dump more than $US10 million in shares once he knew the Food and Drug Administration was going to rule against his cancer drug, Erbitux.
Bacanovic, who the Daily Telegraph said is “a popular figure on Manhattan’s social scene”, is co-operating with an investigation by the Securities & Exchange Commission, according to the report.
Last April, DaimlerChrysler#;s Chrysler Group announced “an extensive multimedia marketing programme” with Martha Stewart Living Omnimedia that would promote its cars and minivans “through MSO’s award-winning array of print, TV, radio, online media and special events”.
In a statement Chrysler said the programme would use a “Road Trips” theme with MSO editors and producers “applying the company’s tried-and-true ‘how-to’ formula and MSO’s unique approach to create features that educate and inform consumers about travel”.
Chrysler would be the sole automotive advertiser in the new “Road Trips” section of Martha Stewart Living magazine, which reaches 13.9 million readers each month, the statement added.
A 12-page pullout in the April issue would feature “Family Fun” while private gardens and nature trips would be highlighted in the May issue with additional travel-related themes featuring throughout the year.
The programme would also include sweepstakes, tips and advice on driving safety and invitation-only events while the “Road Trips” content was also to be delivered through MSO’s Martha Stewart Living syndicated television programme, the “ask Martha” radio show and the marthastewart.com website.
Chrysler vehicle owners, prospective customers and MSO customers would also be invited to a number of “Road Trip” events co-hosted by the Chrysler brand and MSO around the country which would be attended by Martha Stewart and MSO experts.
Chrysler officials did not respond to requests for comment.
