Share this article

print logo

Guilty pleas leave Cameron Collins, fiancée's father facing prison

NEW YORK – Like father, like son. Just as former Rep. Chris Collins showed no emotion when pleading guilty to felony insider trading charges, neither did his son Cameron.

But the face and voice of Cameron Collins' future father-in-law told a much different story.

Moments after Cameron Collins pleaded guilty Thursday to one count of conspiracy to commit securities fraud, Stephen Zarsky – the father of Cameron Collins' fiance – broke down crying before the judge as he confessed to the same crime.

"I'm truly sorry for my action," Zarsky said. "It is a moment of weakness that will haunt me for the rest of my days.”

Both Cameron Collins and Zarsky face the same potential sentence of 37 to 46 months as part of their guilty pleas. That compares to a sentence of up to 57 months for the former Republican congressman from Clarence – who, unlike his son and Zarsky, also pleaded guilty to lying to the FBI in the insider trading case.

U.S. District Court Judge Vernon S. Broderick could sentence the three men to either more time or less, based on the recommendations of probation officers who do a pre-sentencing report along with the recommendations of prosecutors and defense lawyers. All three men will be sentenced in January.

Cameron Collins, the son of former Rep. Chris Collins, arrives at Federal District Court in Manhattan. (Jefferson Siegel/Special to The News)

Thursday's change-of-plea hearing, coming two days after the former congressman pleaded guilty, served as a study in contrasts.

Whereas Chris Collins, 69, entered the courtroom Tuesday smiling and winking at a Buffalo television reporter, his son walked in stone-faced.

Cameron Collins maintained that emotionless demeanor as he confessed to the crime his father induced him to commit.

Republican county chairmen in the 27th Congressional District will hit the pause button until after the Nov. 5 elections when it comes to efforts to find a replacement for Chris Collins (Jefferson Siegel/Special to The News)

"Over a few days in June 2017, I agreed with others, including my father, to sell my shares in Innate Immunotherapeutics," an Australian biotech firm where Chris Collins served on the board, his son said.

"I did this based on information I received from my father, whom I understood owed a fiduciary duty to the company not to share that information," added Cameron Collins, 26.

That information, which Chris Collins got from Innate's CEO via email, showed that the company's only product – a multiple sclerosis drug – had failed in clinical trials. That meant the company's stock was destined to tank as soon as the bad news became public.

That being the case, Cameron Collins started dumping his shares the day after his father called him with the inside information. Prosecutors said he saved himself from $570,900 in losses in the process.

What's more, "I passed on the information to a few close loved ones," including Zarsky, Cameron Collins said.

"I knew what I was doing was wrong and I truly regret the pain I have caused my family, my fiancée and my fiancée's family," he added.

But Cameron Collins didn't come close to demonstrating remorse the way Zarsky did.

He obtained the inside information about Innate's failed drug trials from his future son-in-law on the very night that the congressman had told his son, Zarsky said, and he knew that then-Rep. Collins had a fiduciary duty not to disclose that information.

To hear Zarsky tell it, he panicked upon hearing the bad news.

"I was beside myself over losing all my retirement savings," which he had invested in Innate, Zarsky said, his voice cracking. "On the morning of June 23, out of fear, in agreement with my family, I sold all my shares of Innate to avoid financial losses I could not afford."

Stephen Zarsky, right, leaves federal court after entering his guilty plea. (Jefferson Siegel/Special to The News)

Prosecutors said Zarsky shielded himself from $143,900 in losses by dumping his Innate shares.

But that wasn't all he did.

"I also shared the news with other individuals in anticipation that they would sell," added Zarsky, 67.

Shortly after Chris Collins, Cameron Collins and Zarsky were arrested in August 2018, Cameron's fiancée, Lauren Zarsky, reached a civil settlement with the Securities and Exchange Commission over her sale of Innate shares. She had to pay out $19,440 in losses that she avoided by selling her Innate shares early, along with a civil penalty of $19,440 and $839 in interest, according to SEC documents.

Editors' Picks

Dorothy Zarsky, Lauren's mother, agreed to "disgorge her ill-gotten gains" of $22,600, pay a civil penalty of $22,600 and and interest of $975, the SEC said at the time.

In addition, four other people "are alleged to be downstream tippees but not members of the charged conspiracy," said Geoffrey S. Berman, the U.S. attorney for the Southern District of New York, in an August letter to the judge.

This week's guilty pleas came as a surprise. Lawyers for all three defendants had insisted on their innocence since their arrest. And then-Rep. Collins said as recently as three weeks ago that he expected to be exonerated.

But sources close to Chris Collins said earlier this week that he decided to plead guilty after prosecutors threatened to split the case in two. Under that scenario, Cameron Collins and Zarsky would have gone on trial while Rep. Collins filed appeals that would have  challenged his prosecution on a constitutional technicality.

Fearing that scenario could lead to a longer prison sentence for his son, Collins decided last week to plead guilty, and his son and Zarsky agreed, sources close to Collins said.

As a result, "change of plea hearings" unexpectedly appeared on the electronic docket in the case Monday.

Hours later, then-Rep. Collins submitted his resignation to two of the Democratic politicians he most frequently criticized: House Speaker Nancy Pelosi and Gov. Andrew M. Cuomo.

Now Cuomo will have to schedule a special election to fill Collins' seat in New York's 27th congressional district, a heavily Republican stretch of suburbs, small towns and countryside between Buffalo and Rochester. Cuomo said earlier this week that he may schedule the special election for April 28 – the day of the state's Democratic primary.

All three men who pleaded guilty will learn their punishment months before that. The judge scheduled Chris Collins' sentencing for 2:30 p.m. Jan. 17. His son's sentencing is set for 2:30 p.m. Jan. 23, and Zarsky will be sentenced at the same time on the next day.

There are no comments - be the first to comment