First Congressman to Back Trump for President Arrested for Insider Trading
Christopher Collins, an upstate New York politician, who was first elected in 2012 and was the first Congressional Republican to endorse Donald Trump in 2016, has been arrested on charges of insider trading related to an Australian biotechnology company.
Collins, the second largest shareholders of Innate Immunotherapeutics and a board member of the biotech firm, is a Republican from the Buffalo area who is up for re-election this fall. His son Cameron Collins and the father of his son’s fiancée, Stephen Zarsky have also been arrested by FBI agents.
According to the indictment, Christopher Collins received non-public information about negative results from Innate’s clinical trials from the company CEO in an email. Collins then shared this information over the phone with his son knowing well that it was in breach of his duties to Innate. His son Cameron then passed on the information to Zarsky. The prosecutors allege that in course of the four days before the negative drug news was announced publicly, they and others who were tipped by Collins and his ilk sold more than 1.78 million Innate shares, avoiding losses of approximately $768,000.
The indictment also notes that although the congressman did not trade himself and lost millions of dollars when the stock plunged, he was “virtually precluded” from trading his own shares due to a variety of reasons, including the fact that he was under investigation by the Office of Congressional Ethics for his investment in the company.
He encouraged many of his Republican colleagues including former Health and Human Services Secretary Tom Price to buy Innate stock. Price was forced to resign earlier in September 2017 after it came to light that he had used private charters and military aircraft for travel costing the department more than $1 million.
Upon Collins’ insistence Price bought shares of the company in 2015 and 2016 while still a member of the House, representing Georgia. It has also been revealed that at least four others from Collins’ Republican House including Mike Conaway of Texas and Doug Lamborn of Colorado bought into Innate’s shares in January while the company traded at an all-time high of $1.20 per share. It is worth noting that Collins’ chief of staff, Michael Hook is among the top 20 shareholders of Innate, and so are two of the congressman’s children.
Knowing well about the powers that come with being a politician in the US Collins brazenly bragged publicly, and even in front of reporters, about how many of his friends, colleagues, and donors he had made wealthy by recommending that they invest in Innate.
Geoffrey Berman, U.S. Attorney for the Southern District of New York, said at a news conference, “these charges are a reminder that this is a nation of laws, and everyone stands equal before the bar of justice.” He further added, “the charges today demonstrate that once again, no matter what the crime and no matter who committed it, we stand in the pursuit of justice without fear or favor.”
Attorneys for Chris Collins, on Wednesday morning, released a statement noting that the congressman would comment more on the issue later in the day. The released statement read, “it is notable that even the government does not allege that Congressman Collins traded a single share of Innate Therapeutics stock. We are confident he will be completely vindicated and exonerated.”
House Speaker Paul Ryan stripped Collins of his seat on the Energy and Commerce Committee and called for an investigation by the House Ethics Committee.
“Insider trading is a clear violation of the public trust,” Ryan said.
House Minority Leader Nancy Pelosi pointing towards the wrongdoings by Collins said that his behavior reflects the culture of the Republican Party as a whole.