Hoss
09-23-2005, 11:18 AM
http://www.usatoday.com/money/industries/health/2005-09-23-hca-frist_x.htm
2 weeks before his family company had a bad earnings report and took a sharp decline, Senator Frist ordered the sale of his own stock in the firm. The stock was then selling at a very high price. Now, Senators supposedly have their stocks in a blind trust. But of course, these trusts aren't really blind and the Senators can still order the sale of stocks.
Here are the highlights and there is more in the link.
Frist stock sale draws federal scrutiny
WASHINGTON (AP) — Regulators are investigating Senate Majority Leader Bill Frist's sale of stock in HCA (HCA), the hospital operating company founded by his family.
In a statement released Friday, the company said federal prosecutors for the Southern District of New York issued a subpoena for documents HCA believes are related to the sale of its stock by the senator.
Frist's office confirmed the Securities and Exchange Commission is also looking into the sale.
The SEC also contacted HCA on Friday to informally request copies of the subpoenaed documents, HCA spokesman Jeff Prescott said. "We of course will comply with that request," he said.
Frist traded using only public information, and only to eliminate the appearance of a conflict of interest, Frist spokesman Bob Stevenson said in an e-mail Friday.
"Not surprisingly, the Securities and Exchange Commission contacted Senator Frist's office after the story appeared in the press about the sale of his Hospital Corporation of America stock," Stevenson said. "The majority leader will provide the SEC any information that it needs with respect to this matter."
Frist spokeswoman Amy Call declined to comment on the timing of the sale, saying, "His only objective in selling the stock was to eliminate the appearance of a conflict of interest."
HCA, the nation's largest for-profit hospital company, was founded by Frist's father. His brother was formerly its CEO and chairman and remains on the board of directors.
Frist asked a trustee to sell all his HCA stock in June, near a 52-week stock price peak of $58.40 and at the same time HCA insiders were selling off shares. Reports to the SEC showed insiders sold about 2.3 million shares, worth about $112 million, from January through June, said Mark LoPresti of Thomson Financial.
The sale came about two weeks before the company issued a disappointing earnings forecast that drove its stock price down almost 16% by mid-July. They still have not recovered, closing Thursday at $45.90.
To eliminate the appearance of a conflict of interest? Huh? He'd had this stock the entire time he'd been in the Senate. So he sold high two weeks before a crappy earning report hit to "eliminate the appearance of a conflict of interest." Oh, and he sold his wife's kid's stocks too.
This all comes in as the Jack Abramoff scandal led to a Bush administration official being fired - Rove and Delay have been implicated in that affair. Then there is Plame gate which is working its way to both Rove and Bolton. And the investigation into Delay's pack which is getting closer and closer to indicting Delay.
As most of you all know, the way these grand jury investigations into big fish work is that the prosecutor starts with the small fish and then keeps turning them against progressively bigger fish. And that is what is happening in all of these cases. Anybody interesting in the day to day of these scandals can visit http://www.talkingpointsmemo.com/. Lot's of good stuff.
2 weeks before his family company had a bad earnings report and took a sharp decline, Senator Frist ordered the sale of his own stock in the firm. The stock was then selling at a very high price. Now, Senators supposedly have their stocks in a blind trust. But of course, these trusts aren't really blind and the Senators can still order the sale of stocks.
Here are the highlights and there is more in the link.
Frist stock sale draws federal scrutiny
WASHINGTON (AP) — Regulators are investigating Senate Majority Leader Bill Frist's sale of stock in HCA (HCA), the hospital operating company founded by his family.
In a statement released Friday, the company said federal prosecutors for the Southern District of New York issued a subpoena for documents HCA believes are related to the sale of its stock by the senator.
Frist's office confirmed the Securities and Exchange Commission is also looking into the sale.
The SEC also contacted HCA on Friday to informally request copies of the subpoenaed documents, HCA spokesman Jeff Prescott said. "We of course will comply with that request," he said.
Frist traded using only public information, and only to eliminate the appearance of a conflict of interest, Frist spokesman Bob Stevenson said in an e-mail Friday.
"Not surprisingly, the Securities and Exchange Commission contacted Senator Frist's office after the story appeared in the press about the sale of his Hospital Corporation of America stock," Stevenson said. "The majority leader will provide the SEC any information that it needs with respect to this matter."
Frist spokeswoman Amy Call declined to comment on the timing of the sale, saying, "His only objective in selling the stock was to eliminate the appearance of a conflict of interest."
HCA, the nation's largest for-profit hospital company, was founded by Frist's father. His brother was formerly its CEO and chairman and remains on the board of directors.
Frist asked a trustee to sell all his HCA stock in June, near a 52-week stock price peak of $58.40 and at the same time HCA insiders were selling off shares. Reports to the SEC showed insiders sold about 2.3 million shares, worth about $112 million, from January through June, said Mark LoPresti of Thomson Financial.
The sale came about two weeks before the company issued a disappointing earnings forecast that drove its stock price down almost 16% by mid-July. They still have not recovered, closing Thursday at $45.90.
To eliminate the appearance of a conflict of interest? Huh? He'd had this stock the entire time he'd been in the Senate. So he sold high two weeks before a crappy earning report hit to "eliminate the appearance of a conflict of interest." Oh, and he sold his wife's kid's stocks too.
This all comes in as the Jack Abramoff scandal led to a Bush administration official being fired - Rove and Delay have been implicated in that affair. Then there is Plame gate which is working its way to both Rove and Bolton. And the investigation into Delay's pack which is getting closer and closer to indicting Delay.
As most of you all know, the way these grand jury investigations into big fish work is that the prosecutor starts with the small fish and then keeps turning them against progressively bigger fish. And that is what is happening in all of these cases. Anybody interesting in the day to day of these scandals can visit http://www.talkingpointsmemo.com/. Lot's of good stuff.