Stewart co-defendant reports to federal prison at Nellis AFB

NELLIS AIR FORCE BASE - Martha Stewart's co-defendant and former stockbroker reported to a federal prison camp Tuesday to begin serving a five-month sentence for lying to investigators.

Peter Bacanovic, a former broker at Merrill Lynch & Co., arrived at the minimum-security camp located on Nellis Air Force Base at 11:45 a.m., said Traci Billingsley, a spokeswoman for the U.S. Bureau of Prisons in Washington, D.C.

Bacanovic's lawyer, Richard M. Strassberg, said by telephone that while Bacanovic reported to prison early, his appeal remains pending.

"We intend to continue vigorously pursuing the appeal," Strassberg said.

Stewart and Bacanovic were convicted last year of lying about why Stewart unloaded shares of ImClone Systems Inc. stock in 2001, just before the price plunged.

At the all-male Nellis prison camp near Las Vegas, Bacanovic will join 653 other inmates who work an average of seven hours a day maintaining the facility. The inmates are mostly minor drug offenders, with a small percentage convicted of white-collar crimes.

Once released, Bacanovic will serve five months of home detention.

Stewart, who founded Martha Stewart Living Omnimedia, Inc., began serving her five-month sentence in October, and is due to be released in early March from a prison in Alderson, W. Va.

She will then spend five months confined to her home in Bedford, N.Y.