From the testimony in the Martha Stewart case, it looks like she did indeed lie to investigators. So what law has she violated? The New York Sun editorializes:
[T]he counts that really got our attention in the Stewart indictment are numbers three and four, in which Ms. Stewart is charged with violating Title 18 of the United States Code, Section 1001. That is the federal law that provides for a fine or up to five years in prison for anyone who “knowingly and willfully” makes any materially false statement or representation “in any matter within the jurisdiction of the executive, legislative, or judicial branch of the Government of the United States.”
The law has been on the books since 1863, but it was amended and expanded by Congress in 1934 as the New Deal required more federal disclosures. Today, Section 1001 is well known as dangerous territory by legal experts on all sides of the American political spectrum….
[A] liberal Supreme Court justice, Ruth Bader Ginsburg…, in a concurring opinion in the 1996 Supreme Court case Brogan v. United States, warned of “the sweeping generality” of Section 1001’s language.
Justice Ginsburg wrote: “The prospect remains that an overzealous prosecutor or investigator–aware that a person has committed some suspicious acts, but unable to make a criminal case–will create a crime by surprising the suspect, asking about those acts, and receiving a false denial…. The Department of Justice has long noted its reluctance to approve §1001 indictments for simple false denials made to investigators.” [NYSun]
See also Guy Lesser’s column, in which he points out how Martha was “aggressively over-indicted”.