Common Cause today called on the Senate Ethics Committee to initiate an investigation to determine whether Senate Majority Leader Bill Frist (R-TN) violated Senate ethics rules by directing trustees to sell his HCA Inc. stock held in a blind trust. 

The model blind trust agreement available on the Ethics Committee's website states that there shall be no "direct or indirect communication" between senators and trustees unless the senator is directing the trustee "to sell all of an asset . . . [which] creates a conflict of interest or the appearance thereof due to the subsequent assumption of duties" by the senator.

It is difficult to identify what Senator Frist's "subsequent assumption of duties" will be or how they might differ from his current duties. A spokesperson for Senator Frist has indicated that the sale was initiated to avoid a conflict of interest because the senator is preparing to promote health care legislation in the 109th Congress. However, the stated intention of promoting legislation does not appear to meet a reasonable definition of a "subsequent assumption of duties."  Especially since Senator Frist has made countless decisions affecting the health care industry during the last three years as Senate Majority Leader, such as decisions on committee appointments, executive branch appointments, budget and appropriations measures, etc.
 
Senator Frist also sponsored the Medicare Prescription Drug Benefit bill in 2003. HCA had a clear legislative interest in this bill. Lobby disclosure reports filed by a lobbyist firm working for HCA, The Smith-Free Group, indicate that it lobbied members of the Senate on this bill on behalf of HCA. Senator Frist owned HCA stock at the time, and according to published reports was in communication with his trustees concerning his financial assets. It defies logic that Senator Frist's recently stated intention of promoting health care legislation in the coming months qualifies as a possible conflict of interest while his sponsorship of major health care legislation in the past, such as the Medicare Prescription Drug Benefit bill, did not.

It is difficult to believe that the Committee would consider Senator Frist's justification for intervening in the administration of a "qualified blind trust" satisfactory because it would severely weaken the "arm's length" restrictions placed on qualified blind trusts that are meant to prevent conflicts of interest or the appearance thereof. The new standard for a "subsequent assumption of duties" that would allow members to sell assets in a qualified blind trust would become meaningless. Senators would merely have to announce the intention of working on certain legislation in order to qualify.

Click here to read the full letter to the Ethics Committee.