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Key Witness Faneuil Says Martha Stewart Approved Stock Sale
Aired February 05, 2004 - 06:47 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL COSTELLO, CNN ANCHOR: Martha Stewart got an earful yesterday from the government's key witness. But the defense is fighting back.
Carrie Lee is live from the Nasdaq market site to fill us in on what most likely will be a very rough cross-examination.
CARRIE LEE, CNN FINANCIAL NEWS CORRESPONDENT: That cross- examination continuing today, Carol. A quick recap on yesterday, the government's star witness in the Martha Stewart trial testified yesterday that Martha authorized sale of her ImClone Systems stock after he told her that the company's founder was trying to sell his stake. Former Merrill Lynch assistant Douglas Faneuil testified that he had been instructed to call Stewart by his boss, ex-broker Merrill -- Peter Bacanovic, who is Stewart's co-defendant in the case.
Now Faneuil is 28 years old. He testified that he told Stewart by telephone -- quote -- "we have no information on the company, but Peter thought you would want to act on Sam's" -- Sam Waksal's -- "trying to sell his shares." Faneuil testified that after some questioning Stewart said -- quote -- "I want to sell all of my shares."
Now Faneuil's testimony built on his revelations on Tuesday that Bacanovic ordered him to give Stewart the confidential tip. Basically saying get Martha on the phone when he was told about the Waksal sale.
Faneuil, remember, initially told investigators that Stewart sold her shares for tax loss reasons. So why the change in the story? Well Faneuil said I couldn't continue to do this. I lied to the SEC on two different occasions. The cover-up was part of my daily existence and I just couldn't take it anymore.
Carol, meanwhile, prosecutors are really trying to undermine Faneuil's credibility, asking about -- him about drug use. He did say he used ecstasy, marijuana, cocaine during his time at Merrill. So they are clearly trying to undermine his credibility. And the cross- examination continues today. A very interesting story.
COSTELLO: And it could get quite ugly.
Carrie Lee live from the Nasdaq.
LEE: Uglier.
COSTELLO: Carrie Lee live from the Nasdaq market site.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
Sale>
Aired February 5, 2004 - 06:47 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL COSTELLO, CNN ANCHOR: Martha Stewart got an earful yesterday from the government's key witness. But the defense is fighting back.
Carrie Lee is live from the Nasdaq market site to fill us in on what most likely will be a very rough cross-examination.
CARRIE LEE, CNN FINANCIAL NEWS CORRESPONDENT: That cross- examination continuing today, Carol. A quick recap on yesterday, the government's star witness in the Martha Stewart trial testified yesterday that Martha authorized sale of her ImClone Systems stock after he told her that the company's founder was trying to sell his stake. Former Merrill Lynch assistant Douglas Faneuil testified that he had been instructed to call Stewart by his boss, ex-broker Merrill -- Peter Bacanovic, who is Stewart's co-defendant in the case.
Now Faneuil is 28 years old. He testified that he told Stewart by telephone -- quote -- "we have no information on the company, but Peter thought you would want to act on Sam's" -- Sam Waksal's -- "trying to sell his shares." Faneuil testified that after some questioning Stewart said -- quote -- "I want to sell all of my shares."
Now Faneuil's testimony built on his revelations on Tuesday that Bacanovic ordered him to give Stewart the confidential tip. Basically saying get Martha on the phone when he was told about the Waksal sale.
Faneuil, remember, initially told investigators that Stewart sold her shares for tax loss reasons. So why the change in the story? Well Faneuil said I couldn't continue to do this. I lied to the SEC on two different occasions. The cover-up was part of my daily existence and I just couldn't take it anymore.
Carol, meanwhile, prosecutors are really trying to undermine Faneuil's credibility, asking about -- him about drug use. He did say he used ecstasy, marijuana, cocaine during his time at Merrill. So they are clearly trying to undermine his credibility. And the cross- examination continues today. A very interesting story.
COSTELLO: And it could get quite ugly.
Carrie Lee live from the Nasdaq.
LEE: Uglier.
COSTELLO: Carrie Lee live from the Nasdaq market site.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
Sale>
