Collins, two co-defendants reach settlements with SEC

Dec 10, 2019

Former congressman Chris Collins and two men charged with him in a federal insider trading case have agreed to settlements with the Securities and Exchange Commission.

Collins, his son Cameron, and Stephen Zarsky pleaded guilty to criminal insider trading charges in October. On Monday, the SEC announced settlements that bar Chris Collins from serving as an officer or director of a public company. Cameron Collins and Zarsky are required to disgorge the losses they avoided as a result of insider trading.

The charges stem from the three men selling stock in an Australian biotech company after a failed clinical drug trial, before that failure became public knowledge. Chris Collins was on the board of Innate Immunotherapeutics Ltd. at the time and shared the information with his son and Zarsky, his son's future father-in-law. Collectively they sold nearly 1.7 million shares and avoided losses of more than $700,000.

“Insider trading undermines investor confidence in the fairness and integrity of the securities markets,” said Stephanie Avakian, co-director of the SEC's Enforcement Division. “Today’s settlements, along with the previous criminal pleas, should deter others who may be tempted to engage in this pernicious conduct.”

Under the settlement, Cameron Collins and Zarsky agreed to disgorge their avoided losses with prejudgment interest totaling $634,299 and $159,880, respectively.

Chris Collins, a Clarence Republican who represented the 27th District before resigning in the fall, will be sentenced Jan. 17. The two other defendants will be sentenced the following week.