Congressman Collins, son charged with insider trading

The case relates to Innate Immunotherapeutics Ltd (IIL.AX), where Christopher Collins sat on the board and held a 16.8 percent stake.

Prosecutors said that in June 2017, while attending the congressional picnic at the White House, Collins learned in an email from Innate’s chief executive that a trial for its proposed secondary multiple sclerosis drug MIS416 had failed.

According to the indictment, Collins immediately called his son and told him the news. Cameron Collins in turn told his fiancée, her parents and a friend, and Stephen Zarsky went on to tip his brother, his sister and a friend, the indictment said.

Christopher Collins did not trade his own Innate stock, which lost millions of dollars in value, according to the indictment. Prosecutors said the congressman was “virtually precluded” from trading in part because he already faced a congressional ethics probe over Innate.

However, prosecutors said others used the insider information to avoid more than $768,000 in losses when Innate’s share price plunged 92 percent on news of the drug trial’s failure.

Sydney-based Innate did not respond to a request for comment outside business hours.

Collins represents New York’s solidly Republican 27th Congressional District, and nonpartisan analysts have predicted he will win re-election. The district includes areas surrounding Buffalo and Rochester.

Last October, the Office of Congressional Ethics reported that it had “substantial reason” to believe Collins may have used his office to help Innate.

It voted unanimously to send its case to the House Ethics Committee. Collins denied wrongdoing.

Reporting by Jonathan Stempel and Brendan Pierson in New York; Editing by Howard Goller, Jonathan Oatis and Lisa Shumaker

Article Appeared @https://www.reuters.com/article/us-usa-congressman-insidertrading/congressman-collins-son-charged-with-insider-trading-idUSKBN1KT1NI

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