U.S. lawmaker charged with insider trading halts re-election bid

August 11, 2018

By Susan Cornwell

WASHINGTON (Reuters) – U.S. Representative Chris Collins, a Republican ally of President Donald Trump who has been charged with taking part in an insider trading scheme, said on Saturday he was suspending his campaign for re-election to Congress.

In a statement posted on Twitter, Collins said he thought the decision was in the best interest of his constituents in New York, as well as the Republican party and “President Trump’s agenda.”

Collins was charged earlier this week with taking part in an insider trading scheme involving an Australian biotechnology company, Innate Immunotherapeutics LTD , on whose board he served. He has denied the charges.

Collins, 68, said he would fill out the remaining few months of his term in office. “I will also continue to fight the meritless charges brought against me and I look forward to having my good name cleared of any wrongdoing,” he said on Twitter.

Republicans are nervous about their prospects for holding onto their majorities in Congress in the November election, in which all 435 U.S. House members and one-third of the Senate stand for election. Democrats need to pick up 23 seats to take control of the House of Representatives.

Collins, who was one of Trump’s earliest supporters in Congress, had been seeking a fourth two-year term in the solidly Republican 27th congressional district in the western part of New York.

Non-partisan analysts had predicted Collins would win re-election, but his indictment put Republicans on the defensive. Democrats branded the development as an example of a “culture of corruption” under Trump, pointing to ethical scandals that have ensnared several cabinet members and Trump’s former campaign manager Paul Manafort, now on trial on bank and tax fraud charges.

Another development this week that gave Republicans cause for unease was their underwhelming showing in a special election for a House seat in a reliably conservative district of Ohio. They appeared to eke out a victory, but the margin was tiny and a recount is underway.

An indictment issued on Wednesday charged Collins, his son, Cameron, and Stephen Zarsky, the father of Cameron Collins’ fiancee, with securities fraud, wire fraud and other crimes. All three defendants pleaded not guilty.

Prosecutors said Collins tipped off his son to news that a drug trial at Innate Immunotherapeutics had failed. While Collins did not trade his own stock, prosecutors said, others used the insider information to avoid more than $768,000 in losses when Innate’s share price plunged 92 percent on news of the drug trial’s failure.

(Reporting by Susan Cornwell; Editing by Steve Orlofsky)

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