New York Congressman Chris Collins Is Charged With Insider Trading

Fifteen minutes later, still at the picnic, Mr. Collins answered Mr. Wilkinson, prosecutors said. “Wow. Makes no sense. How are these results even possible???,” he wrote Over the next five minutes, phone records included in the indictment show, Mr. Collins called his son, missing him six times before they had a brief conversation. Prosecutors claim that in that conversation he told his son about the unsuccessful drug trial.

The following morning, the indictment said, Cameron Collins placed an online order with his brokerage firm, selling more than 16,500 shares of Innate Immunotherapeutic stock. Over the next few days, Mr. Collins, 25, placed 53 more sell orders and passed the tip to others, including his fiancée, Lauren Zarsky, and Ms. Zarsky’s father, Stephen Zarsky, 66.

Cameron Collins and Mr. Zarsky were also charged with insider trading and lying to investigations. Acting on the tip from Cameron Collins, Mr. Zarsky avoided about $144,000 in losses. Mr. Zarsky’s wife, daughter and brother also dumped their stock before it dropped in price, though they were not charged, the indictment said.

Mr. Collins pleaded not guilty in federal court in Manhattan on Wednesday and was released on a promise he would produce a $500,000 bond within two weeks. He said nothing as he left the courthouse and climbed into a black S.U.V. His son and Mr. Zarsky also pleaded not guilty and were given similar bail packages.

On June 27, 2017, the day after Cameron Collins made his last trades, news of the failed drug test became public and the company’s stock plummeted by more than 90 percent. The congressman did not sell his any of own stock, prosecutors said, because he was already under investigation by the Congressional Ethics Office.

[Read our January 2017 report on Innate Immunotherapies and its allies in Washington.]

At a news conference on Wednesday announcing the indictment, the United States attorney in Manhattan, Geoffrey S. Berman, who was appointed by Mr. Trump, said that Mr. Collins later lied to federal agents investigating the case. “Congressman Collins, who by virtue of his office helps write the laws of our nation, acted as if the law did not apply to him,” Mr. Berman said.