By Andrew O'Reilly
Published September 12, 2019
Rep. Chris Collins, R-N.Y., pleaded not guilty on Thursday in a Manhattan federal court to charges in a new indictment stemming from his arrest for alleged insider trading.
Collins, who last year already entered a not guilty plea on the original insider trading charges, was arraigned on a superseding indictment that prosecutors hope will speed up the case against the New York Republican.
The new indictment against Collins streamlines the charges against the lawmaker by keeping only five of the original eight securities fraud counts from the original indictment. The new indictment also drops two of the original eight securities fraud charges against the congressman's son, Cameron Collins, while leaving the remaining charges in place.
"The government has made these modifications in the original indictment in an effort to avoid unnecessary pretrial litigation that could delay the resolution of the matter," Geoffrey S. Berman, the U.S. Attorney for the Southern District of New York, wrote in a letter to the judge in the case. Collin’s trial is slated to begin sometime in early 2020, but his attorneys are expected to push to have it delayed given the superseding indictment.
Along with Collins and his son, Stephen Zarsky, the father of Collin’s son’s fiancée, has also been charged in the case. The fraud counts relate to securities of an Australian biotechnology company called Innate Immunotherapeutics, where the 69-year-old congressman served on the board.
Prosecutors allege that Collins passed along secrets to his son, Cameron, in June 2017. They say the son traded on the inside information and passed it to Zarsky. They added that Zarsky traded on it and tipped off at least three others.
According to the original indictment, Collins specifically got early word that a drug the company developed to treat multiple sclerosis wasn't performing well in a medical trial and passed on the tip to his son.
Prosecutors said the three avoided over $768,000 in losses by trading ahead of the public announcement of the failed drug trials.
The advocacy group Public Citizen filed a request for an investigation of Collins' stock dealings with the Office of Congressional Ethics and the Securities and Exchange Commission in January 2017.
The congressman, who has served New York's 27th District since 2013, surrendered to federal agents in Manhattan last August.
In 2017, the House Ethics Committee probed the congressman at the behest of the late Rep. Louise Slaughter. She authored the STOCK Act, which barred lawmakers and aides from using proprietary information to trade securities.
The Ethics Committee report on Collins was muddled. It did not punish Collins. But it did not exonerate him either.
When asked about the report by Fox News, Collins at the time called Slaughter “a despicable human being.” Collins disputed the findings and said he has “always followed ethics.”
Following the charges brought against Collins last year, then-House Speaker Paul Ryan removed Collins from his post on the House Energy and Commerce Committee and called the insider trading charges "a clear violation of the public trust."
Collins has a track record of publicly backing Trump, including being one of the first sitting members of Congress to endorse his candidacy. While he originally said last year that he would not seek re-election following the indictment leveled against him, he reversed course and eventually defeated Democrat challenger Nate McMurray – albeit by a much narrower margin than previously expected, 49.1 percent to McMurray’s 48.8 percent.
Fox News' Marta Dhanis and The Associated Press contributed to this report.