Crime

Congressman Arrested For Insider Trading Immediately Pretends To Not Understand Insider Trading

Baker Hostetler's opening defense for this man assumes everybody is stupid.

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NY Congressman Chris Collins, a.k.a. ‘Blue Horseshoe’

Congressman Chris Collins (R-NY, which I didn’t know was still a thing) was arrested this morning on charges of insider trading.

Collins represents a district in upstate New York and was a perfectly obscure elected official, until he hitched his wagon to the Trump train. Collins was the first sitting member of Congress to publicly endorse Donald Trump. Collins was emphatic that Trump should not be required to release his tax returns. So, keep in mind Trump’s pardon power as we discuss Collins’s legal troubles.

The allegations against Collins represent one of the most simple insider trading “schemes” you’ll ever read about. Collins serves as a board member for Australian biotech company Innate Immunotherapeutics. Collins allegedly received information about a failed drug trial from Innate Immunotherapeutics. According to the Department of Justice, Collins then called his son, Cameron Collins, and gave him the information. Cameron passed the information to his fiancee’s father, Stephen Zarsky, and both men traded on the non-public information.

Innate Immunotherapeutics’ stock price plummeted after the failed trial was made public. Our partners at Med City News have some great reporting about Innate Immunotherapeutics.

Again, that’s as textbook an “insider trading” allegation as you are likely to see: Collins, the “insider,” passed material non-public information to his boy, who then traded on that market-beating information.

Chris Collins ran for office on the strength of his business acumen. He’s a former CEO. But now, Collins would like the public to think that he doesn’t know what insider trading is at all. He’s being represented by Baker Hostetler, and the firm put out this statement after Collins’s arrest:

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“We will answer the charges filed against Congressman Collins in Court and will mount a vigorous defense to clear his good name. It is notable that even the government does not allege that Congressman Collins traded a single share of Innate Therapeutics stock. We are confident he will be completely vindicated and exonerated.

Congressman Collins will have more to say on this issue later today.”

No, the government does not need to allege that Collins traded “a single share” of stock… because you do not need to trade a single share of stock to be guilty of insider trading, AND YOU GODDAMN WELL KNOW THAT, Baker Hostetler. Collins is in a safe Republican district (to the extent that any Republican congressional districts are “safe” this cycle). But this press release here suggests that he’s banking on the good people of the Finger Lakes region to be too stupid to know how insider trading laws work.

Ultimately, I imagine Collins’s defense strategy will be “Can’t a man talk to his own son without the GOVERNMENT hassling him? Back when America was great, a father could pass on material non-public information to his kin and it was called ‘super time,’ not an illegal conspiracy to defraud the market!”

We have been here before in the recent past. New York banker Sean Stewart was accused of passing material non-public information to his father, Robert Stewart. Sean alleged that his dad betrayed him and traded on that information, without the knowledge of his son. Robert took a plea, but Sean went to trial with his sad story. Sean Stewart was convicted and sentenced to three years in prison.

If Congressman Collins comes up with a similar story of family betrayal, it might work on some voters. He’ll probably get re-elected. But eventually, he’ll probably go to jail.

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And then, Trump will probably pardon him. LOL NOTHING MATTERS.

Earlier:

Ex-Perella Weinberg Banker Says His Father Is A Great Guy Who Just Stole Inside Information From Him And Traded On It

Elie Mystal is the Executive Editor of Above the Law and the Legal Editor for More Perfect. He can be reached @ElieNYC on Twitter, or at elie@abovethelaw.com. He will resist.

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