New York Republican Rep. Chris Collins was arrested Wednesday on charges including insider trading and lying to authorities. The indictment documents and related complaint from the Securities and Exchange Commission illuminate a wild chain of events that led to the arrest.
Here are three of the most eye-popping details from the documents:
1. Collins got the bad news at the White House Congressional Picnic
In the federal indictment unsealed Wednesday, prosecutors detailed how Rep. Collins took the first steps in a criminal conspiracy that included securities fraud and wire fraud while attending the congressional picnic at the White House on June 22, 2017. The Congressional Picnic is an annual event held of the south lawn of the White House, where lawmakers and their families are invited to eat, socialize and spend time with the president and White House staff in a casual context.
While at the picnic, Collins learned via email about “extremely bad news” about a hotly anticipated Innate Immunotherapeutics clinical drug trial for multiple sclerosis. He is on the board of the Australian biotechnology company. Still on the South Lawn, Collins replied to company’s top executive saying, “Wow. Makes no sense. How are these results even possible???”—and within six minutes called his son, Cameron Collins, to share the non-public news, the indictment states.
Phone records included in the indictment show that Rep. Collins called his son Cameron, missing him six times before they finally spoke. There are pictures of Rep. Collins on his phone at the picnic about the time prosecutors allege their conversation took place.
“Approximately fifteen minutes after this call ended, Cameron Collins’ girlfriend logged into the brokerage account in which she held the Innate shares she had bought two days before,” the SEC complaint states.
2. Nothing brings the in-laws together like … a joint indictment
The indictment Wednesday was truly a family affair, with charges filed against Collins, his son Cameron and the father of Cameron’s fiancee, Stephen Zarsky.
The SEC’s complaint alleges that Cameron Collins told his girlfriend, who owned shares as well, and the two of them drove to the home of her parents, who were also shareholders. That evening, the girlfriend’s mother placed an order to sell her shares; early the next morning, Cameron Collins, his girlfriend and her father began selling their shares, the SEC complaint states. Her father, Stephen Zarsky, then began telling his friends, as well as his brother and sister, to sell their shares.
The SEC documents even include a flow chart of the tangled web of family members involved.
The SEC complaint says Collins tipped off his son Cameron with the expectation he would trade on the news, and that his actions constitute illicit disclosure of “material, nonpublic information” about Innate’s negative drug trial results.
3. Collins knew he was already under the microscope
Just 17 days before the phone calls and emails from the congressional picnic, Rep. Collins had spoken to the Office of Congressional Ethics regarding his holdings in and promotion of Innate Immunotherapeutics. On June 5, Collins had a lengthy interview with OCE staff, in which he said that instead of asking who in Congress he talked with about Innate, “The bigger question would be, who haven’t I talked to?” He also told the OCE that two of his children owned Innate stock and that “most” of his congressional staff also owned stock.
That means Collins knew that his relationship and actions with Innate were drawing scrutiny well before the results of the clinical trial came in.
At that point, the OCE had not yet sent the case to the House Ethics Committee for further review or action. But in August 2017, the House Ethics Committee took up an inquiry into Collins amid allegations that he had shared nonpublic information about the company.