Congressman accused of insider trading is resigning

The New York congressman was accused in a federal court case.

September 30, 2019, 2:32 PM

Republican Rep. Chris Collins of New York, accused of insider trading, has resigned, a spokesman for House Speaker Nancy Pelosi confirmed Monday.

“We are in receipt of a letter of resignation. It will be laid down on the House Floor tomorrow during pro forma. Resignation will be effective at that time,” the spokesman told ABC News.

Jennifer Brown, Collins' press secretary, declined to comment on the congressman's intent to plead guilty in a brief statement: "The Congressman, nor his office, will comment on this ongoing legal matter." She referred inquiries to Collins' attorney Jonathan Barr at Baker Hostetler, although Barr did not return multiple voicemail messages seeking comment.

PHOTO: Representative Chris Collins is interviewed during the 2017 "Congress of Tomorrow" Joint Republican Issues Conference in Philadelphia, Jan. 25, 2017.
Representative Chris Collins is interviewed during the 2017 "Congress of Tomorrow" Joint Republican Issues Conference in Philadelphia, Jan. 25, 2017.
Mark Makela/Reuters, FILE

A conservative from upstate New York, Collins represents the swath of suburbs between Buffalo and Rochester and was the first U.S. congressman to endorse Donald Trump’s candidacy and remained a staunch Trump ally.

Last September, after Collins and another GOP congressman faced federal charges, Trump tweeted, "Two long running, Obama era, investigations of two very popular Republican Congressmen were brought to a well publicized charge, just ahead of the Mid-Terms, by the Jeff Sessions Justice Department. Two easy wins now in doubt because there is not enough time. Good job Jeff..."

Collins was at the White House in June 2017 for the annual congressional picnic when he received an email, court records show.

The chief executive of Innate Immunotherapeutics had “bad news to report,” according to court records. A multiple sclerosis drug the Australian firm had been developing failed a clinical test.

Collins, who served on the company’s board of directors, replied, “Wow. Makes no sense. How are these results even possible???”

One minute later, according to court records, Collins began a series of phone calls to his son Cameron to tip him off to the test results “anticipating Cameron Collins would use it to trade and tip others.”

The test results were made public four days later and Innate stock dropped 92 percent. By then, however, Collins, his son and his son’s future father-in-law had avoided $768,000 in losses.

A grand jury returned an indictment charging the trio with insider trading. The men surrendered to the FBI in New York.

“We will answer the charges filed against Congressman Collins in court and will mount a vigorous defense to clear his good name,” a statement from his attorneys said at the time. “We are confident he will be completely vindicated and exonerated.”

Collins, his son Cameron, and Stephen Zarsky pleaded not guilty at the time. The judge set bail at $500,000 each.

The congressman was ordered to surrender his diplomatic passport. All three men were ordered to surrender firearms to local authorities.

Collins originally denied the charges brought against him.

"I believe I acted properly and within the law at all times with regard to my affiliation with Innate," Collins said at the time. "The charges that have been levied against me are meritless."

Democrats celebrated Collins' pending resignation.

"The fact that Congressman Collins is resigning just hours before publicly admitting that he violated federal law and lied to his constituency about it, is yet another sad chapter for the Republican Caucus," Rep. Cheri Bustos, the chairwoman of the Democratic Congressional Campaign Committee, wrote in a statement.

Nate McMurray, a Democrat who lost a tight race to Collins in 2018 and is mounting another campaign in NY-27, also reacted to news Collins decided to resign.

“The real victims of Collins' crimes are the people of his district that he repeatedly lied to about his guilt," McMurray noted. "Collins and Republican party insiders robbed his constituents of the representation they need on important issues like the rising cost of healthcare, the opioid epidemic, and the fight for good paying jobs."

This is a developing story. Please refresh for updates.

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