Martha Stewart and Peter Bacanovic -- of domestic multimedia empire and ImClone Systems stock trading fame -- have agreed to settle civil charges of insider trading brought by the Securities and Exchange Commission.
Stewart's December 2001 sale of ImClone stock, prompted the civil SEC charges, which were put on the backburner when both Stewart and Bacanovic were convicted of insider trading at a criminal trial. The SEC accused Stewart of receiving an illegal top from her former broker, Bacanovic.
Under the terms of the agreement, neither Stewart nor Bacanovic will admit, nor deny, any wrongdoing.
Stewart agreed to pay the maximum civil penalty of just over $137,000 (representing three times the amount of losses avoided), another $45,000 in disgorgement (representing losses avoided from the trade), as well as prejudgment interest of about $12,000. She will also be banned for the next five years from serving as a director of a public company. Her current title at the company she created, Martha Stewart Living Omnimedia, is founding editorial director, but she is not a member of the board and doesn't have any formal executive title within the company.
Bacanovic agreed to pay a civil penalty of $75,000, as well as disgorgement of commissions and a prejudgment interest -- taking on another $645 in costs. The SEC already barred Bacanovic from acting as a broker-dealer in the future.
Register or login for access to this item and much more
All Accounting Today content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access