CNN/Money One for credit card only hard offer form at $9.95 One for risk-free form at $14.95 w/ $9.95 upsell  
News > Newsmakers

Martha reports to prison
Homemaking diva turns herself in to W. Va. minimum-security facility to start 5-month sentence.
October 8, 2004: 2:41 PM EDT

NEW YORK (CNN/Money) - Martha Stewart reported to prison in West Virginia early Friday morning to begin serving a five-month sentence for lying about a stock trade.

Click here

"By the time you read this, I will have reported to a minimum-security prison in Alderson, West Virginia, to begin serving my five-month sentence," the home-making diva said in a statement posted on her Web site.

Stewart, 63, was sentenced in July to five months in prison and five months of home detention after being convicted in March for lying to investigators about her sale of ImClone Systems Inc. stock in late 2001, right before the stock tumbled.

Last month, Stewart asked a federal judge to let her begin her sentence as soon as possible so that she could put her "nightmare" behind her.

Judge Miriam Goldman Cedarbaum granted the request and ordered her to report to prison by Oct. 8.

Stewart had hoped to serve her sentence at a prison in Danbury, Conn., near her home in Westport and her 90-year-old mother. Her second choice was the federal prison in Coleman, Fla.

Ultimately, the Federal Bureau of Prisons assigned Stewart to the minimum-security women's prison in Alderson, W. Va., known as "Camp Cupcake." Stewart arrived at Alderson at about 6:15 a.m., according to the bureau.

The West Virginia facility is located in the foothills of the Allegheny Mountains, more than 400 miles south of Stewart's Westport home.

The facility, opened in 1927 as the first federal prison for women, once housed Billie Holiday, as well as Lynette "Squeaky" Fromme and Sara Jane Moore -- both of whom tried to assassinate President Gerald Ford. It has no perimeter fence, and inmates can spend their free time playing volleyball and tennis or even doing aerobics.

Despite Stewart's enormous talents as a lifestyle trendsetter and entrepreneur, prison guards will be watching her like a hawk to ensure the 63-year-old inmate does not conduct business behind bars.

How did she spend her last few days before heading in to stir? A spokeswoman for her company said Stewart was in the office Thursday and has been working all week, staying at her home in Westport.

What's next?
graphic graphic graphic
Now that Martha Stewart is about to begin her 5-month term, what becomes of her company? CNNfn's Allan Chernoff reports on the potential for a comeback at Martha Stewart Living Omnimedia.

premium content Play video
(Real or Windows Media)

Even after Stewart steps foot inside Alderson, her lawyers will continue working on her appeal. A day before she was to start serving her sentence, the lifestyle trendsetter's legal team accused prosecutors of withholding evidence and sent a letter to federal prosecutors and the judge who oversaw the trial, hoping to overturn Stewart's conviction.

Stewart's legal team argued that the federal government should have provided them with documents that emerged as evidence during the recent perjury trial of a key prosecution witness in the case, ink expert Larry Stewart, who is no relation to Martha.

On Tuesday, Larry Stewart was acquitted of criminal charges that he had lied on the stand.

graphic graphic graphic
West Virginia Living : CNNfn's Mary Snow reports on Martha Stewart's start of a 5-month prison term.

premium content Play video
(Real or Windows Media)

With Stewart starting her sentence Friday, she is scheduled to be out by early March -- just in time to begin work on her television program during the five-month home detention period.

Shares in Martha Stewart Living Omnimedia (MSO: down $0.45 to $16.14, Research, Estimates), which have roughly doubled in price since Stewart was sentenced in July, fell about 2 percent at midday Friday.

The New York retail and media company has already renewed its namesake's contract as chief editorial and media director. Stewart and her company also plan to team up with reality show guru Mark Burnett when she returns to her multimedia empire.

Who's next?

In going to prison, Stewart joins a growing list of once high-flying corporate executives brought down by scandal. Some, like Stewart, have been prosecuted for lying to government investigators. Others, including former Enron Corp. chief Kenneth Lay, are accused of more serious crimes and face far stiffer sentences.

A number of indicted executives are now behind bars, including former ImClone CEO Sam Waksal and former Enron assistant treasurer Lea Fastow.

A few more are waiting to learn their fate. Frank Quattrone, a star dealmaker of the late 1990s tech boom, is due to report to prison later this month. The former Credit Suisse First Boston banker was sentenced in September to 18 months in prison for attempting to hinder a government probe of Credit Suisse.

West Virginia
ImClone Systems Incorporated
Martha Stewart

Soon to be sentenced are John and Timothy Rigas, the founder of Adelphia Communications Corp. and his son. They were found guilty in July on 18 felony counts related to the collapse of the now-bankrupt cable company.

Others are awaiting their day in court. Former Tyco International chief Dennis Kozlowski and former Tyco CFO Mark Swartz are scheduled to be tried in New York state court for the second time beginning in early January. Their first go-around in court ended earlier this year in a mistrial.  Top of page

  More on NEWS
Premier League revenues hit record high $6.4 billion
From witness stand, AT&T chief details new $15-a-month streaming service
Window seat or aisle? After Southwest incident, some fliers think twice
Dow unable to shake its worst losing streak in a year
Looking for a job? New hires are getting paid 5% more than they were a year ago
Hedge fund manager Kyle Bass will join Richard Quest on 'Markets Now'

graphic graphic