09/23/2005: Meanwhile, on the other side of the Tennessee Congressional Delegation aisle....
Both HCA and Senator Bill Frist's office have confirmed that the Securities and Exchange Commission and the United States Attorney for the Southern District of New York are investigating Frist's recent "lucky" sale of his holdings in HCA (a hospital operating company founded by Frist's father, and in which Frist family members still own a stake and participate in management, for those of you who haven't been following):
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.Surely, Frist wouldn't be guilty of illegal insider trading, eh? Unfortunately, the basic facts certainly seem a bit suspicious.
Frist's office confirmed the Securities and Exchange Commission is also looking into the sale.
"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," Frist spokesman Bob Stevenson said in an e-mail. "The majority leader will provide the SEC any information that it needs with respect to this matter."
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.
Len on 09.23.05 @ 11:56 AM CST