Reed: Up to the people to determine Collins’ fate
U.S. Rep. Tom Reed, R-Corning, said ultimately it will be up to the people to determine the future of U.S. Rep. Christopher Collins, R- Clarence, as far as being a Congressman.
During his weekly conference call with regional media, Reed said Thursday it is up to Collins and his family to determine whether he should continue to run for re-election this fall to remain a member of the U.S. House of Representatives.
Reed said the allegations against Collins for insider trading are very troublesome to hear.
“Obviously these are very serious allegations. We take these allegations very seriously,” Reed said. “It is his choice how he will proceed. I trust the system in place … to let the people weigh in on how the outcome goes forward.”
Reed was asked and said he didn’t have stock in the company — Innate Immunotherapeutics Ltd. Collins allegedly fed insider information to his son, helping family and friends dodge hundreds of thousands of dollars in losses when one of the company’s drugs failed in a medical trial. Reed said he has no detailed information on the allegations or on Innate Immunotherapeutics Ltd.
On Wednesday, Collins was arrested on charges he fed inside information he gleaned from sitting on the board of a biotechnology corporation. Collins pleaded not guilty to an indictment unsealed at a court in Manhattan. The indictment charges Collins, his son and the father of the son’s fiancee with conspiracy, securities fraud, wire fraud and making false statements to the FBI.Speaking to reporters in Buffalo hours after his release on bail, Collins, 68, professed his innocence and said he would remain on the ballot for re-election this fall.
“I believe I acted properly and within the law at all times,” he said. “I will mount a vigorous defense in court to clear my name. I look forward to being fully vindicated and exonerated.”
Prosecutors said the charges stem from Collins’ decision to share with his son insider information about Innate Immunotherapeutics Ltd., a biotechnology company headquartered in Sydney, Australia, with offices in Auckland, New Zealand. Collins was the company’s largest shareholder, with nearly 17 percent of its shares, and sat on its board.
According to the indictment, Collins was attending the Congressional Picnic at the White House on June 22, 2017, when he received an email from the company’s chief executive saying that a trial of a drug the company developed to treat multiple sclerosis was a clinical failure.
It said he then called his son, Cameron Collins, and, after several missed calls, they spoke for more than six minutes.
The next morning, according to the indictment, Cameron Collins began selling his shares, unloading enough over a two-day period to avoid $570,900 in losses before a public announcement of the drug trial results. After the announcement, the company’s stock price plunged 92 percent.
Prosecutors said the son passed the information to a third defendant, Stephen Zarsky. Their combined trades avoided more than $768,000 in losses, authorities said. They said Zarsky traded on it and tipped off at least three others.
U.S. Attorney Geoffrey S. Berman, a Republican, said Collins was supposed to keep the trial results secret.
“Instead, he decided to commit a crime,” he said. “Representative Collins, who, by virtue of his office, helps write the laws of this country, acted as if the law did not apply to him.”
Collins, a conservative first elected in 2012 to represent parts of western New York between Buffalo and Rochester, has vehemently denied wrongdoing. When the House Ethics Committee began investigating the stock trades a year ago, his spokeswoman called it a “partisan witch hunt.”
All three defendants pleaded not guilty and were freed on $500,000 bail.
On Wednesday, House Speaker Paul Ryan, a Republican, said he was removing Collins from the House Energy and Commerce Committee, calling insider trading “a clear violation of the public trust.”
Collins ran unopposed in the Republican primary and he is being challenged in November by Democrat Nate McMurray, who is the town supervisor in the Buffalo suburb of Grand Island.
Reed and U.S. Rep. Kathleen Rice announced Thursday that they will introduce a resolution to amend the current rules of the House of Representatives to prohibit members of the House from serving on the boards of publicly-held companies.
The resolution would create a House equivalent to Senate Rule 37.6(a), which states that no Senator “shall serve as an officer or member of the board of any publicly-held or publicly regulated corporation, financial institution, or business entity.”
Reps. Reed and Rice jointly said:
“We must change the rules to prevent members from serving on corporate boards in order to improve the public’s trust in Congress. There should never be a doubt in the public’s mind to lead them to think their Representative could be corrupted or incriminated because of their stake or position in a private company. We owe the American people this fair assurance. We are announcing a resolution to amend the House Rules to match those of the Senate, which strictly prohibit members of the Senate from serving ‘as an officer or member of the board of any publicly-held or publicly-regulated company.’ This change is important and long overdue, and we urge our colleagues in the House to pass this resolution.”
The Associated Press contributed to this report.