Rep. Chris Collins (R-Clarence) and two others pleaded not guilty to insider trading charges in a federal courtroom in Manhattan on Wednesday. During an evening news conference in Buffalo afterward, Collins rejected calls that he resign from Congress.
“The charges that have been levied against me are meritless and I will mount a vigorous defense in court to clear my name," said Collins in Buffalo. "I look forward to being fully vindicated and exonerated, ending any and all questions relating to my affiliations with Innate.”
The indictment handed up Wednesday charges that on the evening of June 22, 2017 at a congressional picnic, Collins received an email informing him that Innate Immunotherapeutics’ main drug for the treatement of multiple sclerosis had failed its clinical trials. Geoff Berman, U.S. Attorney for the Southern District of New York, said a minute later, Collins attempted to call his son.
“At 7:16 p.m., as alleged in the indictment, Congressman Collins illegally tips his son Cameron about the drug trial results so that his son Cameron could trade on those results,” said Berman.
That information was important because it was not yet available to the public. When it was released a few days later, the company’s stock price dropped more than 90 percent.
Collins said he did not trade a single share of Innate stock.
"When it became clear that the drug I and others believed in fell short of our hopes and expectations, I held on to my shares rather than sell them," Collins said. "As a result, the significant investment I made in the company, worth millions of dollars, were wiped out.”
However, when Collins’ son Cameron and his fiancé’s father Stephen Zarsky sold the stocks, they avoided more than $700,000 in combined losses, according to Berman.
“Congressman Collins had an obligation, a legal duty, to keep that information secret until that information was released by the company to the public, but he didn’t keep it secret," Berman said. "Instead, as alleged, he decided to commit a crime. He placed his family and friends above the public good.”
The allegations of Collins tipping off his family were serious enough for House Speaker Paul Ryan to remove Collins from the House Energy and Commerce Committee. Democrats are calling for Collins to resign.
“This is quite extensive," said Rep. Brian Higgins (D-Buffalo). "The gravity of this situation requires a serious consideration (for) Congressman Collins to resign.”
“He is clearly now embroiled in this personal battle with his finances in a personal legal struggle," said Erie County Democratic Committee Chair Jeremy Zellner. "How is he going to represent the 27th district? He ought to step down because it is an embarrassment and he is incapable of representing this district.”
Buffalo Mayor Byron Brown was among a few others.
Despite this, Collins remains adamant that he is staying in the 27th district race. The election is in November.
“As I fight to clear my name, rest assured, I will continue to work hard for the people and constituents of the 27th congressional district of New York, and I will remain on the ballot, running for re-election this November,” Collins said.
In the 2016 election, Collins received more than twice the number of votes as his opponent Diana Kastenbaum. Will the 2018 election be different? Democratic challenger Nate McMurray said it is an uphill battle, but it is possible.
"We knew this was coming. This is not some big surprise," said McMurray. "I’ve been talking about this since the first day I got in the race. I got in the race because of this. I said look, we can’t have a guy representing us who is just trying to steal and cheat us. The problem I have is, how come so many people close their eyes to it?”
Running a grassroots campaign, McMurray is looking to build his support through small donations. He said those spiked Wednesday morning when news broke about Collins' arrest.
“My goodness it’s been quite a morning. We’ve probably raised more this morning then we have in the whole race,” McMurray said. “It’s not coming from dark sources, it’s coming from $5 and $10 checks. It’s coming from people across this region. It’s an exciting time. We are feeling more and more confident every single second.”
But even with the increased attention, will it matter?
“Here are the simple facts," said Collins. "My connections with the company are well known. I believe I acted properly and within the law at all times with regard to my affiliation with Innate. Throughout my tenure in Congress, I have followed all rules and all ethical guidelines when it comes to my personal investments including those with Innate.”
At Collins’ Wednesday night press conference, he refused to take any questions from the media after making his statement.
“Because my focus is to defeat the charges in court after today, I will not address any issues related to Innate Immunotherapeutics outside of the court room,” Collins said.
McMurray says this arrest should get people questioning if Collins is still qualified for the job.
“Did you see that press conference (Wednesday) morning? Look at those facts," Mc Murray said. "If you know prosecutors, they do not put together a message like that unless they are confident. They are very confident. Let’s understand what happened here guys. He used his position to enrich himself.”