NYT on FRIST’s possible insider trading - and HUGE 2000-3 HCA FRAUD

[Nothing Without Hope]

Fool us once….

At least two earlier DU threads have dealt with the highly suspicious coincidence of Bill Frist dumping all his shares in his family company, Hospital Corporation of America (HCA), just before they would be predicted to fall based on insider information. Both are based on the same Associated Press article, dated Sept 21; the report appeared under different titles in the Washington Post and Yahoo News.

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=104x4836856
thread title: Senator Frist Sold Stock Before Price Dropped (AP, Wash Post)
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x1795036
thread title: Frist Sells Shares in Hospital Corporation (AP, Yahoo News)

Neither of these versions of the AP article revealed the most interesting history of HCA. In fact, culminating in June of 2003, the company settled with the Justice Department in what was the greatest ever settlement for medical care fraud: $1.7 BILLION DOLLARS. This includes an earlier payment of over $840 million in criminal fines, civil restitution and penalties on December 14, 2000

But DUer bozita knew about this sorry history of the Frist family company and posted the stunning 2003 press release on it in this important thread:
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=104x4819871
thread title: The next time someone bitches about looting in NOLA, show this to them

The press release on the 2003 HCA fraud, from the Department of Justice, should be read in its entirety. Here is an excerpt:

http://www.usdoj.gov/opa/pr/2003/June/03_civ_386.htm
FOR IMMEDIATE RELEASE?THURSDAY, JUNE 26, 2003
WWW.USDOJ.GOV
CIV?[phone]?TDD [phone]

LARGEST HEALTH CARE FRAUD CASE IN U.S. HISTORY SETTLED
HCA INVESTIGATION NETS RECORD TOTAL OF $1.7 BILLION

WASHINGTON, D.C. - HCA Inc. (formerly known as Columbia/HCA and HCA - The Healthcare Company) has agreed to pay the United States $631 million in civil penalties and damages arising from false claims the government alleged it submitted to Medicare and other federal health programs, the Justice Department announced today.

This settlement marks the conclusion of the most comprehensive health care fraud investigation ever undertaken by the Justice Department, working with the Departments of Health and Human Services and Defense, the Office of Personnel Management and the states. The settlement announced today resolves HCA's civil liability for false claims resulting from a variety of allegedly unlawful practices, including cost report fraud and the payment of kickbacks to physicians.

Previously, on December 14, 2000, HCA subsidiaries pled guilty to substantial criminal conduct and paid more than $840 million in criminal fines, civil restitution and penalties. Combined with today's separate administrative settlement with the Centers for Medicare & Medicaid Services (CMS), under which HCA will pay an additional $250 million to resolve overpayment claims arising from certain of its cost reporting practices, the government will have recovered $1.7 billion from HCA, by far the largest recovery ever reached by the government in a health care fraud investigation.

(snip)

Now, FINALLY, the New York Times has put the pieces together, mentioning the earlier fraud cases in the same new article about the possible insider trading by Frist. (Thanks to bozita for the headsup! :hi:) Once again, you heard it on DU first.

http://www.nytimes.com/2005/09/22/politics/22frist.html
September 22, 2005

Senate Leader Explains His Sale of a Stock That Then Plummeted

By DAVID D. KIRKPATRICK

WASHINGTON, Sept. 21 - Senator Bill Frist offered an explanation on Wednesday for the timing of his sale in June of his stake in HCA, the giant hospital company that his family founded, as its shares reached a peak and began a steep slide.

(snip)

The senator's spokesman, Bob Stevenson, said Wednesday that Mr. Frist "made a conscious decision to divest himself of all HCA assets" so he could pursue an ambitious agenda of health care legislation free of any appearance of self-interest.

(snip)

The question, Professor Coffee { Prof. John C. Coffee, an authority on securities law at Columbia} said, is whether Mr. Frist received private information about the company performance from his brother or other insiders.

(snip)

Five years ago, the company pleaded guilty to 14 criminal counts for filing fraudulent Medicare reports and paying doctors kickbacks for referrals. It eventually paid $1.7 billion in fines and penalties in connection with the case.

(sinp)

By the way, according to the AP article cited in the earlier DU threads, HCA has long been a major contributor to Frist’s political campaigns:

http://news.yahoo.com/s/ap/20050921/ap_on_go_co/frist_shares
(snip)

Frist's father, Thomas, founded the company and his brother, Thomas Jr., is a director and leading stockholder. The family is worth $1.1 billion, according to Forbes magazine.

HCA — formerly known as Columbia HCA Healthcare Corp. — has been a top contributor to the senator's campaigns, donating $83,450 since 1989, according to the Center for Responsive Politics.

(snip)

Naturally, the lugubrious Dr. Frist couldn’t POSSIBLY have been aware of any of the fraud over the years, just like he couldn’t POSSIBLY have been aware that the stock in his family company was expected to drop. All good Fristians know what a man of God he is, and if you wait til his next photo-op, he'll demonstrate!

Fool us once…

[NVMojo]

1. shit

I've been trying to tell people this for several years! I worked for an offspring for-profit of this same company and ...I could go on ....

[Nothing Without Hope]

3. Feel welcome to go on - but you might want to wait until after getting

some sleep. I know, this kind of thing can really wind a person up. :grr:

Sometimes I wonder if the neocons are having a secret "top hypocrite" contest. Frist is definitely in the running.

[silverweb]

2. Wow.

Just... wow.

We're all still betting the farm that Frist never sees the inside of a jail cell, right?

:crazy:

[Nothing Without Hope]

4. Oh, I wouldn't be so sure. If he gets nailed with insider trading he might

The press appears to be telling the truth about the lying neocons for now - let's hope that continues. Nobody likes a hypocrite, and he is beyond disgusting.

[Bozita]

7. The Republican offering on the altar of non-partisanship

Let's make Frist even more evil than ... oh, let's say... Tom DeLay or (cough) Kennyboy Lay.

A Martha "make-up" call.

Meanwhile, the NY Times has finally made the link between a pretty slimy healthcare-for-profit corporation and a US senator bailing out of his family business before the financial hurricane swallows some of his holdings.

Never underestimate DU.

[Nothing Without Hope]

8. It was you who pointed out the past massive frauds of HCA, days before

the "big news" venues did. :yourock:

I'm encouraged by the fact that the NYT is even MENTIONING HCA's slimy past. Frist has been almost untouchable for too long, and maybe his teflon is eroding with the Bush Administration's credibility over Katrina and the Iraq War.

[Bozita]

10. It's really simple. Got angry when "whites searched for food" ...

... and blacks "looted."

Thought of Bill Frist posing for cameras wearing a stethascope.

Wondered why the media never saw a link between Frist and HCA.

I got pissed and googled.

BTW, I'm still pissed.

[Nothing Without Hope]

11. We should ALL be pissed and see to it that the pissedness is spread

far and wide. It's about damn time that this sorry excuse for a human being is booted. He's caused so much damage, and he's a total hypocrite. The slime factor is off the charts.

Our Swamp Rat created a wonderful pustulent green Bill Frist image featuring, among other ineffable adornments, cat skulls in the background. SR lost so much in New Orleans - I hope he is well.

[acmejack]

14. Good work, Bozita!

I would like to see Frist go down. Of course, I might be prejudiced, I recently had to pay HCA $8,000 above and beyond my insurance. They are very aggressive in their collection attempts. Nothing like recovering from a major operation and being harassed for money.

[FreedomAngel82]

39. You're not a lone

I'm a fellow Tennessean and can't stand Frist. Ugh. He's just a neocon wannabe and wants to lick Bush's boots too so he can be president. He deserves to be in jail with DeLay and they can be jail mates with Bubba or something.

[silverweb]

23. We can hope.

I'll try to overcome my cynicism that has grown out of control in the past few years and join your hopefulness. :)

Yes, Frist is beyond disgusting -- but then again, so is this entire administration.

[Nothing Without Hope]

26. It's not so much that I believe he'll be indicted, it's more that I refuse

NOT to believe it and want to work toward getting the truth.

Without hope - the practical kind that is saying you refuse to give up on important things - we've got nothing. And it's amazing what powerful intention can accomplish. If Gandhi, Mandela, and many others could join this discussion, they'd say so too.

[Digit]

5. Kickedy Kickedy KICK!

Nominated

[Dover]

6. I think Martha Stewart should offer him a prison tour

complete with cell decorating tips.

Surely this is the revenge of the shelter cats he's killed. Kitty Karma?

[SoCalDem]

9. Make him use a litter box in his cell

:)

[jhain]

16. spew!! n/t

[Nothing Without Hope]

12. bedtime kick

Watching Rita close on the coast is not conducive to sleep.

[qanda]

13. Message to Frist

Don't mess with Bush! The BFEE will make sure you go down.

[The Backlash Cometh]

15. Nepotism to the teeth, here. Put that son of a bitch in jaiil!

The God damn family owns the company for God's sake!

To answer the question of the DUer who asked how stupid do they think we are? The answer is apparent. Pretty damn stupid to pull this crap and know they can get away with it.

[Zynx]

17. This figures. Many Republicans think insider trading should be legal.

They like the idea executives of companies have an edge on everyone else even though it destroys any notion of an efficient market.

[The Magistrate]

18. People Go To Jail For This, Ma'am

It is a text-book illustration of the crime....

[Nothing Without Hope]

19. kick n/t

[understandinglife]

20. Jail time in this dude's future. Martha Stewart should write a 'how-to'

... manual on prison etiquette and other relevant information; she'll have a large readership in the next few years.


Peace.

[FreedomAngel82]

40. LOL

Or maybe she can make a personal call to Frist to give advice or give it on Oprah or Larry King or something.

[Nothing Without Hope]

21. kick n/t

[paineinthearse]

22. I want a special prosecutor! nt

[Nothing Without Hope]

24. kick - GD really zooms! n/t

[cassiepriam]

25. HCA is slime, always has been....

well known fact in the health industry

[Nothing Without Hope]

27. Let's make it well known to the public too - "Saint" Frist is due to be

toppled from his fake pedestal, and he can take his prop stethoscope with him.

[Nothing Without Hope]

28. kick n/t

[Nothing Without Hope]

29. Update in this story in the NYT today - stock sale does look very fishy:

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x1800227
thread title: Frist Sold Stock Along With HCA Insiders

[Nothing Without Hope]

30. 9/23 UPDATE: HCA SUBPOENAED BY U.S. ATTORNEY'S OFFICE - Let's cross our

fingers that the process is actually honest enough to indict a neocon in the Bush Administration if the evidence warrants it.

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x1801070
thread title: HCA SUBPOENAED BY U.S. ATTORNEY'S OFFICE; RELATED TO STOCK SALE BY SENATOR

[Nothing Without Hope]

31. SFChron/AP on Frist:"An odor of sleaziness is enveloping the Republicans"

Frist and Delay, linked in an Associated Press article as being the targets of ethics probes - this is so sweet to see at last.. Sanctimonious, greedy hypocrites! Put them in a jail cell together and let them suffer from each other's disgusting company.

http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2005/09/23/national/w123641D81.DTL
www.sfgate.com

Frist, DeLay Fend Off Probes Into Ethics

- By DONNA CASSATA, Associated Press Writer
Friday, September 23, 2005

(09-23) 17:30 PDT WASHINGTON, (AP) --

Heading into a midterm election year, Republicans find themselves with not one, but two congressional leaders — Bill Frist in the Senate and Tom DeLay in the House — fending off questions of ethical improprieties.

The news that federal prosecutors and the Securities and Exchange Commission are looking into Frist's sale of stock in HCA Inc., the hospital operating company founded by his family, comes as a criminal investigation continues of Jack Abramoff, a high-powered Republican lobbyist, and his ties to DeLay of Texas.

(snip)

The year 1994 marked the Republican revolution, when the GOP seized control of Congress after decades of Democratic rule in the House and years in the Senate. The GOP portrayed their rivals as beholden to special interests and corrupt after years of entrenchment.

(snip)

"The overall problem the Republican Party has is it is increasingly looking like Tammany Hall," Wittman {Marshall Wittman, a one-time conservative activist who now works for the centrist Democratic Leadership Council} said. "An odor of sleaziness is enveloping the Republicans and seeping into the administration."

(snip)

[Nothing Without Hope]

32. The plot THICKENS & SICKENS- AP: Frist is now facing TWO probes

and there is evidence that he received updates on the contents of the "blind" trust!
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x1804041
Thread title: AP: Bill Frist now facing two investigations

Short excerpt:

http://www.cnn.com/2005/POLITICS/09/26/frist.blindtrust.ap/index.html
Monday, September 26, 2005; Posted: 10:36 a.m. EDT (14:36 GMT)

WASHINGTON (AP) -- Blind trusts are designed to keep an arm's-length distance between federal officials and their investments, to avoid conflicts of interest. But documents show that Senate Majority Leader Bill Frist knew quite a bit about his accounts from nearly two dozen letters from the trust administrators.

Frist, R-Tennessee, 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.

(snip)

Be sure to go to the post with this update, for the comments are always interesting and often important. Oh, this is looking interesting, and it's encouraging that the story is in CNN.

:popcorn:

[FreedomAngel82]

41. This is going to be so good

:popcorn:

[Nothing Without Hope]

33. Love this CARTOON on Frist's version of "blind trust":

[gatorboy]

34. Isn't it obvious by now why this man went into politics?

He certainly was a late bloomer when you think about it. He ran for Senate not to help anyone but himself and his families' business. HCA stock went from $27 a share when he first ran for office in '94, to the recent $58 a share.

[Nothing Without Hope]

35. Oh yes indeedy. Frist was there for greed, right from the start.

His brother runs the family business, but Frist was invaluable for the family company too. It's obvious all right.

[FreedomAngel82]

42. Of course, I think it's obvious by

how his families business is a big donor to his campaign(s) and then this happens.

[Nothing Without Hope]

36. 9/28 UPDATE: SEC CHANGES FRIST INQUIRY FROM INFORMAL TO FORMAL

Reported in this thread:
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=104x4920108
Thread title: "FRIST INVESTIGATION: Status Changed to "FORMAL" from "informal"
Pirate Smile General Discussion Wed Sep-28-05 10:30 PM

This gives the SEC a much stronger hand in investigating Frist and is very bad news for our pious cat-killing senator. :evilgrin:

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. The SEC has made the investigation formal, a person familiar with the matter said Wednesday, speaking on condition of anonymity because the agency does not comment publicly on its inquiries.

[autorank]

37. Nailed it again Hope,..extremely thorough.

Now, here's the funny thing. Where I live there are lots of people but only two options for hospitals: a very large non profit community hospital group, 8-10 hospitals, and about 3 HCA's. The HCA's are by far the more welcoming and professional. The other group behaves like a monopoly.

So, if the Frister did it, nail him but not my hospital.

Great post.

[FreedomAngel82]

38. First DeLay and now possibly Frist

Hopefully next month will be Bush and the whole gang.

[Nothing Without Hope]

43. More back story: FRIST CAMPAIGN FINANCE LAW VIOLATIONS:

Right in character with the current insider trading scenario. Note the final sentence in this excerpt from the report on Frist's campaign finance violations at the "Beyond DeLay" web site that is supposed to be about the 13 most corrupt members of congress:

Sen. Frist’s financial activities are of concern not only because they indicate illegality, but also because they suggest that the Senator went to great lengths to protect his own fortune, while squandering that of his contributors.

http://www.beyonddelay.org/beyond_delay/sen_bill_frist_r_tn
(snip)

Campaign Finance Law Violations
Sen. Frist’s financial problems began in June 2000, when he took $1 million of the donations that had been contributed to his 2000 Senate campaign, Frist 2000, Inc., and invested it in the stock market, where it promptly began losing money. This loss was compounded by Sen. Frist’s efforts, in November 2000, to collect $1.2 million he had lent his 1994 Senate campaign committee, Bill Frist for Senate, Inc., out of his personal funds. Of the $6.6 million Sen. Frist had lent his 1994 committee, $1.2 million still had not been repaid by the end of 2000. As a result of the stock market losses, however, Frist 2000, Inc. did not have enough money to repay the loan.

Sen. Frist solved this problem by having the 1994 and the 2000 campaign committees jointly take out a $1.44 million bank loan at a cost of $10,000 a month in interest. While loan documents demonstrate that the two campaign committees jointly borrowed the money, it was Sen. Frist who personally signed the promissory note in two places: as President of Bill Frist for Senate, Inc. and as President of Frist 2000, Inc. On November 28, 2000, Sen. Frist used that money to pay himself back with a check for $1.25 million.

Although bank records show Frist 2000 Inc. as the borrower, Frist 2000 did not report this debt on its Federal Election Commission ("FEC") disclosure forms. Instead, Sen. Frist’s 1994 campaign committee, Bill Frist for Senate, Inc., which was then dormant, was the only committee to declare the loan, making it difficult for the Senator’s donors and political opponents to understand how financially insecure his campaign really was.

The Federal Election Campaign Act requires each treasurer of a political committee to file reports of receipts and disbursements signed by the treasurer. Any loans made or received by the political action committee must be included in those reports. The fact that the $1.44 million loan was disclosed only by one authorized committee, Bill Frist for Senate, Inc., and not also by Frist 2000, Inc., even though the two committees jointly took out the loan, suggests that Frist 2000, Inc. committed a knowing and willful violation of the reporting requirements of 2 U.S.C. §434(b). Moreover, Sen. Frist’s financial activities are of concern not only because they indicate illegality, but also because they suggest that the Senator went to great lengths to protect his own fortune, while squandering that of his contributors.

(snip)

Let's make sure that the people writing about Frist KNOW ABOUT THIS STORY. More research needs to be done by a professional journalist.

[Nothing Without Hope]

44. OH WOW!!! You MUST see this FRIST STOCK TIMELINE from Think Progress:

http://thinkprogress.org/frist-stock-timeline

Thanks to Pirate Smile for mentioning this link, for it is devastating. The sequence shows very clearly the conflicts of interest, the lies, and the fact that this was NOT a blind trust by any stretch of the imagination - though he continued to lie and say it was.

You MUST MUST MUST work through this timeline. Exerpting it would not do it justice. What a total, absolute lying criminal hypocrite!!! And the greed factor - you see it again and again, it's very consistent.

[Nothing Without Hope]

45. kick - no time to post more today n/t

[Nothing Without Hope]

46. Joe Conason: "A Stock Answer From Dr. Bill Frist" A nice summary

Do you suppose Dr. Frist took a HYPOCRITICAL OATH instead of the HIPPOCRATIC OATH? It would explain a lot. Conason's article lays out some of the lying, greedy hstory of this money-grubbing fraud. The excerpt doesn't do it justice.

http://www.commondreams.org/views05/0928-32.htm
Published on Wednesday, September 28, 2005 by the New York Observer

A Stock Explanation From Dr. Bill Frist

by Joe Conason

(snip)

Ever since the telegenic surgeon from Tennessee entered the Senate in 1995, he has been plagued by questions about H.C.A., the gigantic, highly profitable hospital and insurance conglomerate founded by his father and brother. While Dr. Frist billed himself as a health-care expert with a “free-market” orientation, he also had tens of millions of dollars invested in H.C.A. stock.

(snip)

The Jan. 4, 2003 issue of National Journal similarly quoted Dr. Frist claiming ignorance of his holdings: “Right now, I don’t know if I own HCA because it’s a qualified blind trust.”

Yet he did know, according to documents recently uncovered by the Associated Press, because the “blind” trust’s manager had informed him about his H.C.A. stockholdings during the months prior to those interviews.

Now that the press has exposed how he dumped those H.C.A. shares last June, he no longer claims that he didn’t know he owned them. Naturally, he insists that he possessed no inside information about the bad earnings report that H.C.A. made public just two weeks after he had sold off the stock at the peak price. And most amusingly, he claims that when he sold the stock, he simply was trying to satisfy his implacable critics.

(snip)