Ex-ImClone CEO Waksal Indicted for Fraud
Wednesday August 7, 5:02 pm Eastern Time
Reuters Business Report
Ex-ImClone CEO Waksal Indicted for Fraud
biz.yahoo.com
NEW YORK (Reuters) - Former ImClone Systems chief executive Samuel Waksal was indicted on Wednesday for securities fraud in an alleged insider trading scam that has made Waksal a symbol for stock shenanigans in corporate America.
He also was charged for bank fraud and obstruction of justice.
Waksal, 54, of New York, had been trying to reach a plea deal with federal prosecutors for weeks in an effort to avoid the grand jury indictment. He had been arrested in June on a complaint filed by federal prosecutors.
Authorities allege he tried to sell his stock and tipped off family members before a public announcement that the Food and Drug Administration had rejected ImClone's application for a new cancer drug called Erbitux. News of the FDA's rejection wrecked havoc on the company's stock.
Waksal has been accused of receiving a tip on Dec. 26 from his brother Harlan, then the company's chief operating officer and now its chief executive, about the FDA rejection. Waksal then allegedly tried to sell 79,797 shares and alerted his father, Jack, and daughter, Aliza.
Also under federal investigation is homemaking guru Martha Stewart, a friend of Waksal, who sold nearly 4,000 shares of ImClone the day before the FDA news was made public. She has repeatedly said her sale was lawful and based on public information. Although no criminal charges have been filed against her, she has been sued privately by shareholders in her company, Martha Stewart Living Omnimedia . |
