CNN - American Morning

CNN

SHOW: AMERICAN MORNING 07:00

March 8, 2004 Monday

HEADLINE: Martha Stewart's Future; Interview With Congressman James Greenwood; New Era in Iraq

GUESTS: James Greenwood, Michael Shara, John Tisch, Patrick Holland, Rita Lazisky, Ronald Lazisky, Sam Rubin, Toure, Andy Borowitz

BYLINE: Soledad O'Brien, Miles O'Brien, Jack Cafferty, Deborah Feyerick, Jane Arraf, John Zarrella, Carol Costello

HIGHLIGHT:
Martha Stewart is expected to meet with her probation officer. And interview with Congressman James Greenwood. The Iraqi Governing Council signed a new interim constitution.

BODY:
S. O'BRIEN: Deb Feyerick for us this morning downtown.

Deborah, thanks.

Congressman James Greenwood was one of the first to refer Martha Stewart's name to the Justice Department in connection with ImClone nearly two years ago. Martha Stewart's name turned up on phone logs during a House committee investigation of ImClone chief Sam Waksal. And Congressman Greenwood, a Republican of Pennsylvania, joins us this morning from Philadelphia.

Nice to see you, sir. Thanks for being with us.

REP. JAMES GREENWOOD ®, PENNSYLVANIA: Good morning.

S. O'BRIEN: Are you surprised days later about the conviction ever Martha Stewart or no?

GREENWOOD: Well, not terribly. I think everyone was sort of guessing as to what the outcome would be. But we could see this coming two years ago. And it's a tragedy.

This was so easily avoided. I know that about a year and a half ago I had Martha Stewart's attorney in my office and I said to him, "Look, there's an easy way out. All she has to do is say 'I made a mistake,' have a press conference, ask to pay a fine, make a contribution to something like the Enron Employees Fund and say, 'I'm doing this in the name of corporate responsibility.'"

She would have been a heroine. She would have been raised on our shoulders. And all of this would have been avoided. But for some reason...

S. O'BRIEN: But that wouldn't necessarily, though, protect her from any forthcoming charges, right? I mean, she might have taken that step, but there's always the risk there that then you are charged with insider trading, which she will have, in your scenario, just admitted to in a press conference. True?

GREENWOOD: Well, yes, but it was so clear that-the facts in this matter, I thought, were very clear. And I can't believe that she didn't understand that she had tried to-she had participated in this insider trading, and that she had tried to cover it up. And the Justice Department is always going to be lenient if you make a plea bargain agreement, if you don't go to court, if you admit your guilt. It's historically the smart thing to do when you've done something that you shouldn't have.

S. O'BRIEN: When you read, and I'm sure you've seen, also, some of the jurors' comments about what struck them after the conviction-they were caught outside the courtroom-what has struck you most about what they've had to say about this trial?

GREENWOOD: Well, I think as you just said in your point, it was the-it was the fact of the intentional attempt to cover up by Ms. Stewart herself, altering the e-mails, very damning. The fact that she had told her vacationing friend that it was nice to have a broker who will tip you off like that.

So the facts are pretty incontrovertible in this matter. And I just for the life of me don't understand why Martha Stewart would have gone all this way through the trial knowing full well that she had done things that she shouldn't have which were not that serious. And that's the real tragedy. This woman's probably going to go to jail for what were minor offenses and then compounded by the consistent lying to the Justice Department.

S. O'BRIEN: On Friday, you said, "I wouldn't wish anybody ill, including Martha Stewart." Back in June of last year, when you were running for another term, you said this: "I've done some important work on Enron and other corporate scandals. I will probably put Martha Stewart in jail."

In the scheme of all that you've accomplished in your tenure in public service, is this something that you would say you're proud of having done?

GREENWOOD: Oh, no. I am proud of the work that I've done and that my subcommittee has done on corporate irresponsibility on the Enron case, on WorldCom, on Global Crossing, on-we were looking not at Martha Stewart. We never had Martha Stewart in our sights as a target. We were looking at the ImClone Corporation, at Sam Waksal.

This was a very small aside in this matter. And I take not the slightest bit of joy for the fact that Ms. Stewart's going to go to jail. I think it's sad.

I tried everything in my power to help her attorneys avoid this outcome, but they were insistent. And I think she was insistent on taking this very dangerous course. And it led to where I think it inevitably would lead.

S. O'BRIEN: Congressman Greenwood, nice to see you. Thanks for being with us. Interesting insight, of course, from your perspective. Thanks.

GREENWOOD: Pleasure. Thank you.