A Family Affair – US Congressman and Close Family and Friends Charged with Insider Trading

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Congressman Christopher Collins, the U.S. Representative for New York’s 27th Congressional District, his son, Cameron Collins and a third individual, Stephen Zarsky, have been charged by the Securities and Exchange Commission with insider trading. The U.S. Attorney’s Office for the Southern District of New York also filed related criminal charges on Wednesday.

Christopher Collins served as an independent director of an Australian biotech company, Innate Immunotherapeutics Ltd.

During the congressman’s tenure with the firm, Christopher Collins allegedly tipped off his son Cameron Collins after receiving confidential information about negative clinical trial results for Innate’s multiple sclerosis drug. Armed with the information, Cameron Collins and his girlfriend’s father, Zarsky, allegedly made trades and tipped off others regarding the nonpublic information.

According to the SEC, Christopher Collins learned of the negative clinical trial results in late June 2017 from Innate’s CEO. He and the board of directors were told that the drug trial results “pretty clearly indicate ‘clinical failure.’” Immediately thereafter, the SEC alleges that Christopher Collins called and spoke to his son regarding the sensitive information.

Electronic Footprints 

According to the SEC’s complaint, the alleged illegal activity continued when Cameron Collins drove to Zarsky’s home and tipped him off regarding the confidential information.