Bill Frist: No Insider Information

Reporters and photographers surround Senate Majority Leader Bill Frist, R-Tenn., as he holds a press conference, Monday, Sept. 26, 2005, at the U.S. Capitol in Washington. Frist says he "acted properly" when he directed the recent sale of some of his stock, and that an examination of the facts will bear that out. (AP Photo/Haraz N. Ghanbari)
Senate Majority Leader Bill Frist said Monday he had no insider information when he sold stock this summer in HCA Inc., the hospital company founded by his father and brother. The Justice Department and Securities and Exchange Commission are looking into the sales.

Also Monday, the chairman of the SEC, former Rep. Christopher Cox, said that to avoid a potential conflict he would take no part in the agency's investigation.

Questions have been raised about whether Frist had special information before the sale because insiders in HCA also sold stock during the first half of the year — and the stock price dipped soon after Frist sold his stock.

"I had no information about HCA or its performance that was not publicly available when I directed the trustees to sell the stock," Frist said, referring to the sale by administrators of his blind trusts.

CBS News correspondent Gloria Borger reports that Frist's stocks are handled by a blind trust that manages his portfolio without his full knowledge. Frist can request that his stocks in a corporation be sold in their entirety, but never know the actual value — he would only know the

Frist, R-Tenn., said his only objective in divesting his blind trusts of the stock was to avoid any appearance of a conflict of interest. Some critics have contended for years that Frist's holdings led to conflicts with his positions on health care legislation.

On Monday, he promised full cooperation with investigations by the SEC and federal attorneys. He declined to take questions and didn't address the timing of the sale.

It was the first time since the stock sale was publicized a week ago that Frist had spoken publicly on the issue.

"Despite not being required to do so, I sought and obtained two Ethics Committee opinions acknowledging that my ownership of HCA stock complied with Senate rules and did not present a conflict of interest with my Senate duties," Frist said.

"Despite not being required to do so, I later chose to place many of my investments in blind trusts, including my HCA stock. With these efforts, I have sought to guarantee that no conflict of interest existed. Review after review has found nothing wrong."

Frist's sale this year of stock in Hospital Corp. of America Inc., about two weeks before its price plummeted amid massive stock sales by company insiders, has prompted federal investigations.