WASHINGTON – The Securities and Exchange Commission has issued a subpoena to Senate Majority Leader Bill Frist (search) as part of its investigation into the sale of stock in the company founded by his father, FOX News has confirmed.
"The process is pretty standardized for any inquiry by the regulators, so we are working overtime to get them the information they need as quickly as possible to get to the next step," an aide to the leader told FOX News.
The formal request for documents signifies an increase in the seriousness of the probe. Frist's aides had previously said they only had been contacted by regulators, not been handed a subpoena.
The Washington Post reported Thursday that anonymous sources said sometime within the past two weeks, the SEC issued the Tennessee Republican a subpoena for documents and personal records relating to the stock sale.
Frist is being investigated both by the SEC and the Justice Department (search) because of a July sale of HCA Inc. stock. Frist's father and brother founded the Tennessee-based hospital company, and the family still maintains some control.
Frist spokesman Bob Stevenson released a statement later Thursday, maintaining that Frist is cooperating with the authorities in the probe.
"The issuance of a subpoena would be an expected and normal part of that process. An examination of the facts will demonstrate that Senator Frist acted properly," Stevenson said. His only objective in selling the stock was to eliminate the appearance of a conflict of interest. He had no information about HCA or its financial performance that was not publicly available when he directed his trustees to sell the stock."
According to the Frist aide who spoke to FOX News, the senator's lawyers have urged him not to speak about the probe, while his friends want him to fight back.
"Frist just wants any insinuations of criminal wrongdoing of insider trading cleared away and knows that the SEC investigation will verify the facts of the matter, so he wants to give them what they need and then talk to them as soon as they are ready," the aide said.
The majority leader's office still stands by a statement issued in September, which said, among other things: "His only objective in selling the stock was to eliminate the appearance of a conflict of interest."
Frist, who has said he has no intention of running for Senate again in 2008, has said he did not know the value of the stock because it is in a so-called blind trust. He has said he was only divesting himself of the stock to satisfy critics in preparation for a possible 2008 presidential bid.
Before the probe opened, Frist had faced questions over the stock ownership because he is in the position to vote on health care-related bills that could benefit the family-owned company.
The probe of possible insider-trading regulations opened last month, after it became known that shortly after Frist released his holdings in the company, the value of the stock plunged about 10 percent.
The Post also reported Thursday that Frist is expected to testify under oath regarding his knowledge of the company's financial health prior to the sale, and the recent subpoena was written cautiously to avoid conflict over constitutional separation of powers between the executive and the legislative branches of government.
Earlier this week, The Associated Press reported that Frist had profited from ownership of HCA stock outside the blind trust that had been approved by the Senate, renewing criticism of Frist's stock dealings. Blind trusts are designed to put distance between the stock owner and the day-to-day decisions in an effort to quell questions of impropriety.
The AP found that Frist held money in a partnership, although he did not hold a position with the partnership made up mostly of non-public stock. Between 1998 and 2000, Frist earned more than $265,000.
A spokesman for Frist has said that Senate rules do not permit non-public shares to placed in blind trusts (search).
FOX News' Trish Turner contributed to this report.