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Gloria Borger Lie: First knew contents of
blind trust
Media Matters
September 28, 2005
Borger adopted Frist's defense as fact, failed to note that his past defense
was false
CBS News contributor and U.S. News & World Report contributing editor
Gloria Borger continued a pattern, identified by Media Matters for America, of
discussing the brewing scandal over Senate Majority Leader Bill Frist's (R-TN)
suspiciously timed stock sale while leaving out key facts that undermine the
credibility of claims Frist has made in his defense.
Frist is currently under investigation by federal prosecutors and the
Securities and Exchange Commission for initiating the sale of stock in HCA
Inc., a hospital chain founded by his family, shortly before a weak earnings
report caused the company's share price to plummet. The stock was sold from
qualified blind trusts belonging to him and his immediate family. But what
viewers would not know from Borger's report on the September 27 broadcast of
CBS' Evening News is that in a 2003 interview, Frist twice made the
demonstrably false claim that he was unaware his qualified blind trusts
included major holdings in HCA.
Borger reported that the trustees in control of Frist's stock assets "manage
[Frist's stock] largely without his knowledge ... [and] he never knows the
actual amount he owns." Frist has defended himself with similar remarks in the
past, falsely claiming in January 2003 that "[s]o as far as I know, I own no
HCA stock," and "[i]t is illegal right now for me to know what the composition
of those trusts are. So I have no idea."
But Borger failed to note that statements Frist previously made about his
knowledge of his trust's holdings of HCA stock are false. The Associated Press
reported September 24 that Frist received at least three updates on HCA
holdings being added to or sold from his trusts in 2002, plus one update
informing him of an HCA stock transfer into one of his trusts just two weeks
before the 2003 interview in which he denied knowing whether he owned any HCA
stock. And contrary to Borger's assertion that Frist's trustees "manage [his
stock] largely without his knowledge ... [and] he never knows the actual amount
he owns," the AP reported in another September 24 article that "the trustees
for Frist and his immediate family wrote the senator nearly two dozen times
between 2001 and July 2005," giving him "regular updates of transfers of assets
to his blind trusts and sales of assets." The AP reported that these written
updates were specific as to the value of assets traded: "[s]ome assets have a
dollar range of the investment's value and some list the number of shares."
Additionally, Borger accepted as fact Frist's explanation that, in
initiating the sale of HCA shares, he was merely trying to eliminate the
appearance of a conflict of interest, not profit from inside information: "One
thing that is clear ... is that in trying to solve one problem [the apparent
conflict of interest], Bill Frist created another [the scandal surrounding his
stock sale]," Borger said.
From the September 27 broadcast of CBS' Evening News:
BORGER: And Frist doesn't directly trade stock, since it's in a
blind trust, which means others manage it largely without his knowledge. He can
ask that a stock be sold, but he never knows the actual amount he
owns.
JACOB FRENKEL (former federal prosecutor): Instead of calling this
a blind trust, the Senate's version of a blind trust really is an impaired
vision trust.
BORGER: One thing that is clear, Bob [Schieffer, anchor], is that
in trying to salve one problem [the apparent conflict of interest], Bill Frist
created another [the scandal surrounding his stock sale].
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