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GOP Rep. Chris Collins of New York was charged with securities fraud by the FBI on Wednesday
- The criminal indictment against Rep. Chris Collins alleges that he committed insider trading at the 2017 White House congressional picnic.
- Collins conveyed "material, nonpublic information" about an Innate Pharmaceutical drug failing a clinical trial via phone calls to his son, according to the criminal complaint.
- Collins, who represents New York's 27th congressional district, was charged with securities fraud, wire fraud, and lying to investigators by a federal grand jury on Wednesday.
The federal grand jury indictment charging GOP Rep. Chris Collins of New York with securities fraud accuses him of committing insider trading at the 2017 annual White House congressional picnic.
Collins and two co-defendants were charged Wednesday in the Southern District of New York with eight counts of securities fraud, two counts of wire fraud, and two counts of lying to investigators in connection with alleged insider trading Collins committed while on the board of directors of the Australian biotechnology firm Innate Immunotherapeutics.
A section of the indictment alleges that while Collins was at the June 22 picnic, he received a confidential email from the CEO of Innate to the board of directors announcing the results of a failed drug trial.
Upon receiving the email, Collins then called his son Cameron to "tip" him about the information about the failed trial, which had not yet been made public, the indictment says.
In the following days after receiving the insider tip, prosecutors say, Cameron sold over 1.3 million of his shares in Innate before the results of the drug trial were publicly released on June 26, causing the company's stock price to plummet.
The indictment estimates Cameron's alleged insider trading with his father from that tip alone saved him approximately $570,900 in losses. Federal prosecutors accuse co-defendants Cameron and his fiancée's father, Stephen Zarsky ,of trading Innate stocks based on the nonpublic information.
After the FBI arrested Collins on Wednesday morning, his attorneys said they intend to "mount a vigorous defense to clear his good name" in a statement published to his official House website.
"It is notable that even the government does not allege that Congressman Collins traded a single share of Innate Therapeutics stock," they wrote. "We are confident he will be completely vindicated and exonerated. Congressman Collins will have more to say on this issue later today."