USA prosecutors on Wednesday said Chris Collins, a Republican congressman from Western New York, has been indicted for insider trading in connection with the securities of Australian biotechnology company Innate Immunotherapeutics Ltd.
According to the indictment, Collins, a member of Innate's board of directors and one of its largest shareholders, had access to non-public information about its primary business - the development of a drug meant to treat a form of multiple sclerosis. According to The New York Times, Collins is accused of selling his stock in the company before a failed test result for one of its drugs was made public. They say the son traded on the inside information and passed it to a third defendant, Stephen Zarsky.
The indictment could rock Capitol Hill, The Hill newspaper reported in June 2017 that Collins bragged about making members of Congress money via tips about the Australian biotech company.
Collins, one of President Donald Trump's strongest congressional allies, remains under investigation by the committee, which has the power to sanction lawmakers.
Lawyers for Collins released a statement expressing confidence he would be "completely vindicated and exonerated".
"We will answer the charges filed against Congressman Collins in court and will mount a vigorous defense to clear his good name", his attorneys, Jonathan Barr and Jonathan New, said in a statement Wednesday.
Chris Collins, his son and Zansky avoided $768,000 in losses, according to the indictment.
Collins, who resigned in April from the Innate board, has denied wrongdoing.
His district covers parts of western NY between Buffalo and Rochester.