Corporate Crime

Which prison gang will Frist join?

The stock-holding members of Congress are bound by law to have their money in "blind trusts." This way, they don't know what companies may benefit or suffer from the way they vote on bills before them.

But as usual for the GOP, these rules don't apply. Senate Leader Bill Frist knew he owned stock in his family's business, HCA. $13 million worth of stock. He knew it as he voted on Medicare legislation related to HCA's business. And he knew it when he told his broker to sell a month before the stock, as predicted by HCA, tanked.

Is this hearsay? Nope. It's on record:

Frist, R-Tenn., received regular updates of transfers of assets to his blind trusts and sales of assets. He also was able to initiate a stock sale of a hospital chain founded by his family with perfect timing. Shortly after the sale this summer, the stock price dived.

A possible presidential contender in 2008, Frist now faces dual investigations by the U.S. attorney for the Southern District of New York and the Securities and Exchange Commission into his stock sales.

So Frist isn't going to court in Tennessee or Washington, D.C. He's going to court in New York. You know, where Martha Stewart went to court.

Another political problem for Frist: His own statements suggest he had no knowledge of his blind trust investments.

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"

Ah. "I don't know whether or not I own stock in my family's company, I really don't, but I've been getting these reports from my brother about it (who's on the board of trustees, so he knows what he's talking about, but he really hasn't said if I own any stock in his company -- we just talk about it a lot but not about whether or not I'm a multi-million dollar shareholder) but so just in case I DO own the stock, sell now, all 13 million bucks worth, baby!"