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Chris Collins sentenced to 26 months in prison for insider trading

Jan 17, 2020

Collins walks into federal court in Manhattan to be sentenced on insider trading charges.
Credit Danny Lewis / WNYC

Former Congressman Chris Collins will spend 26 months in jail for insider trading charges. The sentence was handed down by U.S. District Court Judge Vernon S. Broderick in Manhattan on Friday.

Collins broke down in court and apologized to his family and his former constituents and colleagues.

“I stand here today as a disgraced former member of Congress,” he said. “My life has been shattered.”

Collins' lawyers had argued he was sorry and should face no prison time. Prosecutors, however, argued he should go to prison for nearly five years.

In October, Collins pleaded guilty to securities fraud conspiracy and making false statements to the FBI in the insider trading case.

Collins was on the board of the Australian-based company Innate Immunotherapeutics Ltd. and while attending a congressional picnic at the White House in June 2017, he received an email from Innate’s chief executive saying that a drug developed by the company to treat multiple sclerosis had proven to be a clinical failure.

That’s when Collins notified his son, Cameron, and Stephen Zarsky, the father of Cameron’s fiancée, about the failed trial, urging them to sell their Innate stock. The sales meant his son and Zarsky avoided a combined $800,000 in losses. Both pleaded guilty to conspiracy to commit securities fraud in October. Cameron Collins will be sentenced Thursday; Zarsky will be sentenced the following day.

Collins had initially denied charges that he leaked information, but he ultimately pleaded guilty and resigned from Congress.

Judge Broderick called it baffling that Collins would exercise such poor judgment when he and his son had the financial means to deal with any loss.

“I have a difficult time reconciling that,” the judge said.

"Collins’s greed and disregard for the law have now led to a criminal conviction for insider trading and lying to the FBI, his resignation from Congress, and over two years in federal prison. Lawmakers bear the profound privilege and responsibility of writing and passing laws, but equally as important, the absolute obligation of following them. Collins’s hubris is a stark reminder that the people of New York can and should demand more from their elected officials, and that no matter how powerful, no lawmaker is above the law,” said U.S. Attorney Geoffrey S. Berman, in a statement following the sentencing.

Collins, a Republican, had represented western New York since his election to the state's 27th Congressional District in 2012. He resigned when he decided to plead guilty to a conspiracy count, leaving the district's constituents without representation in Congress.

Candidates running for the vacant 27th District seat reacted to the sentencing with mixed emotions. Likely Democratic candidate Nate McMurray, who lost narrowly to Collins in 2018, said he did not take joy in seeing Collins sentenced.

"But at the same time, justice must be served, and you can't ignore what happened. This region was lied to. We lost representation. We were told over and over again he would be vindicated. And he laughed at one point about the challenges and about the allegations. But now we see a very different version of Mr. Collins and it is a sad moment," McMurray said.

Republican state Senator Chris Jacobs, one of the candidates vying to represent the GOP in a special election that will likely be held April 28, called it a sad day for both Collins’ family and his former constituents.

“I guess the only good, I hope, is that it’s finally over and we can all move on, as the Collins family can, from this chapter. And hopefully, the Collins family can start rebuilding their lives,” said Jacobs.

Other Republican candidates running for the 27th District seat include state Senator Robert Ortt and former Darien town justice and Fox News contributor Beth Parlato.

The 27th Congressional District includes parts of Monroe, Ontario, Erie and Niagara counties, along with all of Livingston, Genesee, Orleans and Wyoming counties.

Includes reporting from WBFO in Buffalo; The Associated Press, and Matthew Russell Lee (@innercitypress - you can support his work here: https://www.patreon.com/MatthewRussellLee)