The WaPo is now explicitly raising the question of whether Senate majority leader Bill Frist committed insider trading in connection with his June sale of HCA stock:
The timing ... raised questions about whether Frist had somehow traded on information he obtained in advance from the company. "Frist has been in the Senate for many years now, and the conflict is not new," said Melanie Sloan, executive director of the watchdog group, Citizens for Responsibility and Ethics in Washington. "Why did he decide to sell it then? Why not years ago? What's changed? Did he know that the stock was about to take a fall?"
Josh Marshall asks a pertinent question:
Is Frist in some real trouble over this? And if he is, who can explain how a guy with such vaunting ambitions for higher office would do something so foolish and, it would appear, easy to detect?
The Democrat Party's official blog hopes "the SEC takes the question seriously." Meanwhile, the Cunning Realist makes an interesting connection between this dal and the losses Frist's campaign fund previously suffered in the stock market, asking: "Did Frist's ongoing painful experience with losses in his campaign fund cause him to "panic first" when it came to his own wallet?"
One would think a heart surgeon would be smart enough to have avoided even the appearance of impropriety, let alone actual malfeasance, but smart people routinely do really stupid things when it comes to insider trading. Who can forget the way former ImClone CEO Sam Waksal dumped his ImClone stock - and told members of his family to do the same - immediately after hearing from the FDA that the firm's drug wasn't going to be approved for sale. Did he really think nobody at the SEC would notice a little thing like a huge stock dump by the firm's CEO right before an adverse FDA announcement?
Anyway, I discussed the relevant legal issues applicable to Frist's trade in my post Frist's HCA Stock Sale: Insider Trading?. You might also want to check out an oldie but a goodie: Senators and Insider Trading.
