Frist defends timing of stock sale
WASHINGTON – Senate Majority Leader Bill Frist, R-Tenn., said Monday that he had done nothing wrong when he sold his shares of the nation’s largest hospital chain, HCA Inc., from a blind trust and that he had no information about the company’s finances that was not available to the public.
The sale was made in advance of a warning that the earnings had weakened at HCA, which was founded in 1968 by Frist’s father and brother.
“My only objective in selling the stock was to eliminate the appearance of a conflict of interest,” Frist told reporters Monday. “I had no information about HCA or its performance that was not publicly available when I directed the trustees to sell the stock.”
Frist took no questions but said he is cooperating with investigations of the sale by the Securities and Exchange Commission and the U.S. attorney for the Southern District of New York.
SEC Chairman Christopher Cox recused himself Monday from the agency’s investigation to avert what he called “any appearance of impropriety.” Cox, a former California lawmaker who served for nearly a decade as a member of the House Republican leadership before joining the agency last month, cited personal connections to Frist in a prepared statement explaining his decision.
Cox had donated $1,000 to Frist’s reelection bid in 2000 through his own campaign fund, according to records compiled by the Federal Election Commission.
The recusal means that Cox will be barred from briefings about the substance of the SEC staff’s investigation. Instead, the agency’s four other commissioners, evenly split between Democrats and Republicans, would vote on whether to accept or reject the enforcement unit’s recommendation on whether to bring a case.
Frist and Nashville, Tenn.-based HCA disclosed last week that they had been contacted by the SEC and the U.S. attorney about the senator’s decision to sell the stock. The total holdings in senator’s blind trust have had been valued at $7 million to $25 million, according to his financial disclosure statement earlier this year.