CNBC reports that New York GOP Representative Chris Collins has been arrested on insider trading charges. Collins was arrested today and is facing federal charges. The federal grand jury’s indictment cites the Australian biotech company Innate Immunotherapeutics. Collins served as a board member for the company.
Collins, 68, allegedly called his son to tell him private information about a failed drug trial that they both owned shares in. His son, Cameron Collins, 25, and his future father-in-law, Stephen Zarsky, 66, were also charged.
Collins has suffered an immediate political fallout due to these charges. Court records allege that he shared non-public information with his son in June 2017 to make timely trades and to tip others. Cameron then traded based on that information, as well as Zarsky, and both men passed on the information to others.
Due to this insider trading, the trio avoided over $768,000 in losses. It has been noted that Collins did not allegedly trade any of the stock himself. Collins also allegedly gave Tom Price, the U.S. Health and Human Services Secretary, tips on the company.
The Office of Congressional Ethics found that there was substantial evidence that Collins shared nonpublic information in relation to Innate stock, and the House Ethics Committee began its own investigation into the matter.
The three defendants are charged with securities fraud, wire fraud, conspiracy to commit wire fraud, conspiracy to commit securities fraud and making false statements. Collins surrendered to authorities on Wednesday. Each of them faces a maximum of 20 years in prison for the most serious charges.
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