The swamp is slowly being drained – and our President isn’t afraid of confronting the sludge, even when they happen to be his biggest supporters. Just this week, GOP Rep. Chris Collins was indicted on insider trading. The charges stem from alleged federal securities fraud for an Australian pharmaceutical company, Innate. Collins just happens to be one of the company’s highest-volume shareholders.
• Prosecutors specifically charged Collins with distributing nonpublic information about changes at the company, many of which had the power to cause significant change in stock prices. This included unpublished information from several drug trials.
• Chris’s son, Cameron Collins, was also charged for participating in the insider trading scheme, as was his father-in-law, Stephen Zarsky. The prosecution states that Chris Collins specifically gave information to both parties in an effort to aid them in making “timely trades in Innate stock.”
• The alleged charges also accuse the elder Collins of “tipping others,” although it isn’t immediately clear how many or who he may have tipped. It is possible he may have had a widespread influence on the price of the company’s stocks.
• U.S. Attorney Geoff Berman was quick to outline the scumbag moves, claiming that Collins “cheated our markets and our justice system” and “acted as if the law didn’t apply to him.” He also reiterated the importance of shutting down criminals “…no matter what the crime and no matter who committed it.”
• The “insider tip” in question appears to be the failure of an up-and-coming MS drug, which showed promising results earlier on. As the drug moved through the approval and testing process, Innate began actively marketing stocks for it in AUS and the USA.
• By June of 2017, it was clear that the drug wasn’t effective as the company originally believed. Innate pulled stocks for the drug off the Australian market, yet left them intact in the USA.
• As a high shareholder, Collins was advised with other board members; he then messaged the information to his son and Zarsky. Both individuals immediately sold off hundreds of thousands worth of stocks in advance of the assumed drop, saving money.
• Collins, surprisingly, didn’t sell his stocks. In fact, he lost approximately $17 million dollars in the ensuing plummet. But that doesn’t change the fact that he shared confidential insider information, which is plainly illegal.
• “In the hours and days after learning of the drug trial results, [Collins], his son and their associates exchanged a flurry of calls,” the co-director of the SEC’s Enforcement Division reported. “The investigation yielded a detailed footprint left by the defendants, revealing their frantic efforts to sell shares and warn others before Innate announced bad news.”
• Collins’ lawyer has responded. “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,” he stated in a press conference.