Rep. Chris Collins has been charged with insider trading.
MORE | Read the indictment here.
CHARGES | Learn more about the charges here.
Collins served on the board of Innate Immunotherapeutics Limited, an Australian biotechnology company.
According to a criminal complaint, Collins learned of the negative results of some clinical trials for the company, and told his son Cameron about the results before they were released to the public, federal prosecutors say.
A timeline made by investigators says Collins tried to call his son six times immediately after learning the results.
Cameron let his girlfriend and her father, Stephen Zarsky, know of the results, officials say, and according to the criminal complaint, the three off them were accused of selling 1.78 million shares of the company before the results went public.
Collins was interviewed by the FBI on April 25th of this year. Prosecutors say Collins lied to an agent when he said he never told his son about drug trial results for an Innate Immunotherapeutics product before the information was released publicly.— Chris Horvatits (@ChrisHorvatits4) August 8, 2018
Once the results had gone public, the company’s stock dropped 90 percent in one day — going from 45 cents per share to 4 cents.
Collins, his son Cameron, and Cameron’s fiance’s father were all arraigned Wednesday. Each pleaded not guilty.
Bail was set at $500,000 each.
Collins left court in Manhattan Wednesday afternoon. He did not give a comment to reporters.
Congressman Collins has been asked to surrender his diplomatic passport to the FBI and any fire arms to local law enforcement.
A statement from Collins’ attorneys posted on his website says this:
“We will answer the charges filed against Congressman Collins in Court and will mount a vigorous defense to clear his good name. 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.
Congressman Collins will have more to say on this issue later today.
Collins held a press conference in Buffalo Wednesday night, where he dismissed the charges as “meritless”.
“The charges that have been levied against me are meritless and i will mount a vigorous defense in court to clear my name,” Collins said.
He did not step down from his position in Congress and said he will run for re-election in November. To watch Rep. Collins’ full press conference, click on this link.
House Speaker Paul Ryan says Rep. Chris Collins will not serve on the House Energy and Commerce Committee until the legal matter is resolved.
“While his guilt or innocence is a question for the courts to settle, the allegations against Rep. Collins demand a prompt and thorough investigation by the House Ethics Committee,” Ryan said.
Another local Congressman, Brian Higgins, also responded to the charges, saying:
“The allegations included in the indictment against Rep. Chris Collins can be summed up in one word: shameful.
These charges, including insider trading, conspiracy to commit fraud, and lying to federal officials, laid out by professionals within the Justice Department and FBI are backed up by comprehensive evidence of these very serious offenses.
I am confident that, in due course, justice will be served.”
Nate McMurray, the Grand Island Town Supervisor, is currently running against Collins for a seat in the 27th Congressional District. He also responded to Collins’ arrest.
“This is why I got in this race, because I understand that the man who claims to represent this community doesn’t actually represent it,” McMurray said. “Chris Collins has openly admitted that he serves only wealthy donors and that his proudest accomplishment is making millions for his friends here in Western New York and in Washington. That’s not what Congress is for and not what our democracy is about.
Rep. Collins told News 4 in January, 2017, that he had a relationship with Innate for a decade and a half before that. At that time, he was under fire for allegedly passing a tip to a fellow member of Congress about Innate, months before legislation meant to accelerate clinical trials was passed.
“No insider trading; no special deals,” Collins said in that interview. When asked specifically about giving a tip to Rep. Price, Collins answered, “Most everyone I’ve met within the past 15 years, I’ve talked about this company.”
Collins was the largest shareholder in Innate during the period covered by the indictment, with about 16.8 percent of the company’s stock.
He’s currently listed as the second largest shareholder, with 9.24 percent of the company’s stock.
Collins was also on the Innate Board of Directors in June 2017, when the drug MIS416, which had been developed to treat secondary progressive multiple sclerosis, failed its drug trial.
Interim U.S. Attorney for the Southern District of New York Geoffrey Berman spoke during a Wednesday afternoon news conference.
“These charges are a reminder that this is a nation of laws, and that everybody stands equal before the bar of justice,” he said.
He went on to say the congressman “had an obligation, a legal duty, to keep that information secret” until it was publicly released.
Berman says that Collins knew he could not sell his own shares of Inate since he was already under investigation.
Bill Sweeney, with the FBI, says Collins, his son and his son’s fiancee’s father all lied to the FBI.
Collins said in an email Wednesday that he will fight to clear his name.
” We [Collins and son Cameron] both look forward to clearing our good names and being exonerated at trial,” Collins wrote. “Because my focus is to defeat these charges in Court, after today, I will not address any issues related to Innate Immunotherapeutics outside of the courtroom. As I fight to clear my name, rest assured that I will continue to work hard for the people of the 27th Congressional District of New York while remaining on the ballot for reelection this November.”
Watch the news conference with the FBI, SEC and U.S. Attorney’s Office below:
I am proud to represent the people of #NY27. The charges being brought against me are meritless and I intend to fight to clear my name. I will continue to work hard for the people of #NY27 and earn your vote this November— Chris Collins (@CollinsNY27) August 8, 2018