SEC Upgrades Sen. Frist Stock Inquiry
WASHINGTON - The Securities and Exchange Commission, which is examining a stock sale by Senate Majority Leader Bill Frist, has upgraded its initial informal inquiry to a formal investigation.
The change means the agency can issue subpoenas for documents rather than just requesting them. Federal prosecutors also are investigating the Tennessee Republican's recent sale of stock in HCA Inc. about two weeks before its price dropped. Frist's family founded the big hospital operating company.
Already, Nashville, Tenn.-based HCA has said it has received a subpoena from the office of the U.S. Attorney in Manhattan asking for documents the company believes are related to Frist's sale of company stock. Frist's office said prosecutors and SEC investigators had contacted the senator's office about the sale.
Frist ordered the stock sold from several blind trusts this summer, about two weeks before HCA issued a disappointing earnings forecast that drove its share price down almost 16 percent by mid-July.
He sold the stock at a time when top executives and directors of HCA — including the chief executive and the treasurer — also were selling off shares worth a total of $112 million.
http://news.yahoo.com/news?tmpl=story&u=/ap/20050928/ap_on_go_co/frist_stock_1
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