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A Republican congressman from upstate New York has surrendered to the FBI on insider trading conspiracy charges on Wednesday morning, federal prosecutors say, after allegedly passing on nonpublic information to family members that allowed them to avoid sizable losses in the stock market.
Rep. Chris Collins, 68, isn’t the only one in his family facing allegations. His son Cameron Collins, and Stephen Zarsky, the father of Cameron Collins' fiancée, also face similar charges, a spokesman for the U.S. Attorney's Office in the Southern District of New York said, according to the Buffalo News.
The congressman served on the board of Innate Immunotherapeutics, an Australian biotech company. He is also one of the firm's biggest shareholders, NBC News reported. He is accused of passing nonpublic material regarding a drug trial on to his son last year so that the younger Collins could “use that information to make timely trades in Innate stock and tip others,” according to a grand jury’s indictment cited by NBC. The trades were in reference to a drug trial of MIS416 which was supposed to treat a form of multiple sclerosis, a drug trial which failed in the end, leading to the plummeting of Innate's stock price.
Cameron Collins allegedly passed that information on to Zarsky and other unnamed co-conspirators, allowing that group to avoid $768,000 in losses they would have incurred if they hadn’t sold their stocks before the general public became aware that the drug trial had failed, prosecutors say.
"All of the trades preceded the public release of the negative drug trial results," according to the indictment, as reported by Buffalo News, "and were timed to avoid losses that they would have suffered once the news became public."
The congressman maintains his innocence and in a statement written by his attorneys Jonathan Barr and Jonathan New, Baker Hostetler, they stated: "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.”
Last fall, the House Ethics Committee announced that they were investigating Collins’ trades.
Collins has been the United States Representative for New York's 27th congressional district since 2013. Previously he was the county executive of Erie County, New York from 2007 to 2011. He lives in Clarence, New York.
[Photo: Getty Images]