Agency Calls on Frist About Timing of Stock Sale

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By DAVID D. KIRKPATRICK
Published: September 23, 2005

WASHINGTON, Sept. 22 - A spokesman for Senator Bill Frist, Republican of Tennessee, said Thursday that the Securities and Exchange Commission had contacted Mr. Frist's office about the sale in June of his shares in HCA, the giant hospital company founded by his family.

Mr. Frist, whose brother Thomas F. Frist Jr. is chairman emeritus and the largest individual shareholder of the company, disclosed earlier this week that on June 13 he asked the managers of blind trusts controlling many of his assets to sell any of his remaining shares in HCA.

The sales occurred just as the share price reached a new peak and shortly before the company's announcement in mid-July of lower-than-expected quarterly results sent the price tumbling.

Mr. Frist, the Senate majority leader and a potential presidential candidate, initially placed more than $10 million in shares of the company in his trusts, but his spokesman said he could not determine how much remained at the time of the sale.

Mr. Stevenson, the spokesman, said the securities commission had contacted Mr. Frist after news organizations published articles this week raising questions about the profitable timing of the sale. Only a few such contacts lead to formal investigations or penalties.

"The majority leader will provide the S.E.C. any information that it needs with respect to this matter," Mr. Stevenson said. "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. His only objective in selling the stock was to eliminate the appearance of a conflict of interest."

Mr. Stevenson said on Wednesday that Mr. Frist's holdings in HCA had been the subject of at least 19 news articles or public accusations about a possible conflict of interest.

Spokesmen for the S.E.C. could not be reached for comment on Thursday night; the agency customarily does not comment on its inquiries

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