Republican Congressman Chris Collins arrested on insider trading charges suspends reelection campaign
By: Susan Conte, Xiro Xone News August 8, 2018 Updated: 1:12 PM PT
Rep. Chris Collins (R-NY) was arrested and arraigned on federal charges August 8, in New York City. He plead, “Not guilty,” and was released on $500.000.00 bail.
An unsealed indictment in New York federal court, charged Collins, his son, and the father of the son's girlfriend with conspiracy, securities fraud, wire fraud and making false statements to the FBI.
Prosecutors alleged Collins shared insider information with his son about Innate Immunotherapeutic Limited, a biotechnology company in Sydney, Australia. Collins sat on its board and, was the company's largest shareholder.
According to the indictment, while attending the Congressional Picnic at the White House on June 22, 2017, congressman Collins received an email from the company CEO saying, “A trial of a drug the company developed to treat multiple sclerosis was a clinical failure.”
While still at the picnic and seen on video, he called his son Cameron Collins and spoke for more than, six minutes.
Prosecutors said the son “traded on the inside information and passed it to a third defendant, Stephen Zarsky.” “Their combined trades avoided over $768,000 in losses,” authorities said. They said, “Zarsky traded on it and tipped off at least three others.”
The next morning, according to the indictment, and over a two-day period Collins began selling his shares, to avoid $570,900 in losses before the public was made aware the medical trials had failed.
After the public announcement, the company's stock plunged 92 percent.
A written statement from Democratic House Minority Leader Nancy Pelosi read, “The charges against Collins show the rampant culture of corruption and self-enrichment among Republicans in Washington today."