From the Associated
Press

Frist Knew About Blind Trust
Investments Despite Denials,

 Frist Updated on His Investments in Blind Trust Investments

By JONATHAN M. KATZ and LARRY MARGASAK Associated Press Writers The
Associated Press Sep. 24, 2005 – Senate Majority Leader Bill Frist, R-Tenn.,
was updated several times about his investments in blind trusts during 2002,
the last time two weeks before he publicly denied any knowledge of what was
in the accounts, documents show.

The updates included stock transactions involving HCA Inc., the hospital
operating company founded by Frist’s family.

Frist’s sale of HCA stock is under scrutiny by the federal government.
Nashville, Tenn.-based HCA said Friday it had received a subpoena from
prosecutors for the Southern District of New York, asking for documents the
company believes are related to Frist’s sale of company stock this past
summer.

Prosecutors also have contacted the senator’s office, Frist spokesman Bob
Stevenson said Friday. He said neither the senator nor his office had
received a subpoena.

Frist’s office confirmed the Securities and Exchange Commission was
looking into the sale.

“Senator Frist had no information about the company or its performance
that was not available to the public when he directed the trustees to sell
the HCA stock,” Stevenson said in a statement.

Frist sold his HCA stock from several blind trusts this summer, at a time
when insiders in the company also were selling off shares worth $112 million
from January through June. Frist aides say he sold his stock to avoid any
appearance of a conflict of interest.

Frist, asked in a television interview in January 2003 whether he should
sell his HCA stock, responded: “Well, I think really for our viewers it
should be understood that I put this into a blind trust. So as far as I
know, I own no HCA stock”

Frist, referring to his trust and those of his family, also said in the
interview, “I have no control. It is illegal right now for me to know what
the composition of those trusts are. So I have no idea.”

Documents filed with the Senate showed that just two weeks before those
comments, the trustee of the senator’s trust, M. Kirk Scobey Jr., wrote to
Frist that HCA stock was contributed to the trust. It was valued at $15,000
and $50,000.

The documents filed by the trustees of Frist’s blind trusts were obtained
by The Associated Press on Friday.

On Nov. 20, 2002, Scobey wrote Frist that 14,781 shares of HCA were sold,
along with three other investments. The same day, Scobey wrote that four
other investments were sold, none of them HCA stock.

On May 16, 2002, Scobey advised Frist that four investments were
contributed to a Frist blind trust, including HCA stock valued at $500,000
to $1 million. A second letter the same day mentions the same four
investments going into a different trust, but with different valuations,
including HCA stock valued at $250,000 to $500,000.

On Jan. 14, 2002, a trustee for Frist’s children notified the secretary
of the Senate that two investments were added to the blind trusts of Frist’s
sons Jonathan and Bryan including HCA stock valued at $5,000 to $10,000. It
was not clear whether Frist received a copy of the letter.

Stevenson, the Frist spokesman, said he could not comment on the updates
received by the senator. He added that Frist properly notified the Senate
Ethics Committee this summer that he was initiating the sale of all
remaining HCA shares, a requirement under Senate rules. All the stock was
sold by July 1, including shares owned by his wife and children.

“As with the SEC, the majority leader will provide the U.S. attorney’s
office with any information that it needs with respect to this matter,”
Stevenson said.

The SEC also contacted HCA on Friday to informally request copies of the
subpoenaed documents, said company spokesman Jeff Prescott. “We of course
will comply with that request,” he said.

Herb Haddad, a spokesman for the U.S. attorney’s office in Manhattan,
said the office had no comment on the matter. SEC spokesman John Nester
declined to say whether the agency had contacted Frist’s office.

David Becker, who was general counsel at the SEC from 2000 to 2002, noted
that both Frist and HCA were being put under scrutiny.

In insider trading cases, “you connect the dots not by simply going from
one dot to another but by starting at both dots and working toward the
middle,” Becker said. “The facts that are public don’t come close to
demonstrating wrongdoing. It’s way too premature to have any judgment.”

HCA, the nation’s largest for-profit hospital company, was founded by
Frist’s father, the late Thomas Frist Sr. His brother, Thomas Jr., was
formerly its CEO and chairman and remains on the board of directors. Frist
is a heart surgeon by training.

Frist asked a trustee to sell all his HCA stock in June, near a 52-week
price peak of $58.40 a share. Reports to the SEC showed HCA insiders sold
about 2.3 million shares.

Frist’s sale came about two weeks before the company issued a
disappointing earnings forecast that drove its stock price down almost 16
percent by mid-July and still have not recovered. HCA rose $1.70 Friday,
closing at $47.60.

The value of Frist’s stock at the time of the sale was not disclosed.
Earlier this year, he reported blind trusts with all holdings valued at $7
million to $35 million.

AP researcher Rachel Landau in Washington contributed to this report

Not only can the Republican Senate leader not diagnose a patient over a TV,
but he also can not lie properly. We have a trifecta in the making of Republican
leadership facing ethical and legal charges. Tom Delay is most certainly the
next to fall then comes the big man – George “DumbYa” Bush.