MARTHA STEWART has sold her luxury penthouse apartment in New York and dumped shares in the media company she founded, in a last-minute effort to raise cash before she is sentenced for her part in an insider trading scandal.

Ms Stewart, who appears in court today for a sentencing hearing, sold her designer Greenwich Village pad this week for $7 million (£3.8 million) — $1 million under the asking price. She faces up to a year in jail after being found guilty of lying to the US Government about a stock sale.

Ms Stewart’s former apartment is in one of the most sought-after celebrity buildings in New York. The glass-and-concrete apartment block was designed by Richard Meier, architect of the Getty Museum in Los Angeles, and is also home to Calvin Klein, Nicole Kidman and Vincent Gallo.

Ms Stewart, former chief executive of Martha Stewart Living Omnimedia and a television celebrity, put the apartment up for sale in 2002 for $8 million. She bought the 3,600 sq ft flat for $6 million in 2000. She twice reduced the price during her trial, during which she was accused of lying about selling shares in ImClone, a drug company founded by her friend Sam Waksal. Mr Waksal is serving a jail sentence after pleading guilty to insider dealing.

This week an unnamed New York businessman struck a deal to buy the two-storey apartment on the West Side in Manhattan. The 15- storey tower has a gym, a wine cellar and security guards. The monthly service charge is almost $9,000.

Ms Stewart sold a tranche of shares in Martha Stewart Living Omnimedia last month, raising $4.36 million. This was the first time she had sold shares in the company since its formation.

Ms Stewart has no doubt used some of the cash raised to pay an army of consultants, including Herb Hoelter a “sentencing consultant”. He has tried to reach a deal that could allow Ms Stewart to serve some of her sentence under house arrest or as a community service.

Mr Hoelter told The Times that he expects the harshest sentence Ms Stewart could face is ten months spent half in a federal prison camp and half under house arrest. He said it was likely Ms Stewart would be granted bail, pending appeal of her conviction.