WASHINGTON – Chris Collins didn't have to do it. He could have cashed in his million-dollar baseball card collection to cover the losses his son and his future in-laws suffered when the stock he pushed on them went bust. Or he could have cashed in his million-dollar coin collection.
Such tough talk fills the 11-page letter that Geoffrey S. Berman, U.S. attorney for the Southern District of New York, and his assistants sent to the federal judge who is scheduled to sentence Collins on insider trading charges on Friday.
They recommended the former congressman be sent to prison for up to 57 months.
"His choice to commit fraud instead, as if the two options were morally equivalent, bespeaks a total disregard for the rules that are intended to govern everyone’s actions," federal prosecutors wrote Monday. "His subsequent lies to the FBI indicate the same disregard."
Prosecutors argued that a sentence at the top end of federal sentencing guidelines is "necessary to assure the public that those in power do not stand above the law."
Those guidelines call for Collins, a former Republican congressman from Clarence, to be sentenced to between 46 and 57 months in federal prison. Collins' son, Cameron, and Stephen Zarsky, Cameron Collins' future father-in-law, will be sentenced next week and face up to 46 months in prison.
"Collins’s decision to break the law while making the law – a decision that he made twice, ten months apart – was brazen," the prosecutors wrote.
Berman's push for a stiff sentence for the former congressman stands in sharp contrast with what the U.S. Probation Office and Collins' attorneys suggested. The probation office said Collins should spend a year and a day in prison, followed by supervised release and a $200,000 fine. Collins' lawyers suggested no prison time, but instead a sentence of confinement in his Marco Island, Fla., home along with community service.
That home is worth more than $2 million, the probation office said in a report that pegs Collins' net worth at more than $21 million.
"Collins committed a financial crime without having any financial need," the prosecutors wrote.
On the night of June 22, 2017, Collins called his son, Cameron, several times before reaching him and telling him the devastating news about Innate Immunotherapeutics, an Australian biotech firm where the elder Collins served on the board. The clinical trials of Innate's only product, a multiple sclerosis drug, had failed. That meant Innate's stock would soon be nearly worthless, and that anyone who had invested in it – including Collins and his son – would lose their money.
The elder Collins could have stopped to think before dialing Cameron's number again and again that night, prosecutors noted. But instead he kept dialing – and did so again the next day, when Cameron started dumping his shares.
"This was not a crime of passion," prosecutors said.
Then, when FBI agents paid a surprise visit to Collins' Washington condo 10 months later, Collins compounded his crime by lying to them, prosecutors said. First he said he told no one about Innate's trial results; then he said he told only his wife but not Cameron. Then he invented a rationale for Cameron's stock trading: that Cameron had seen that there was a halt in trading in Innate stock in Australia, and that he sold his shares out of concern about the trading halt.
"Collins’s lies to the FBI also defeat the notion that his criminal conduct can be viewed as a one-off mistake in judgment," the prosecutors wrote.
What's more, Collins should have known better, prosecutors added.
"As a person who spent decades in business before serving in Congress – indeed, as someone who served on the Federal Reserve Bank of New York – Collins knew well that financial crimes have harmful ramifications and can destabilize businesses and markets," they wrote. "He chose to commit one anyway."
Collins' role as a member of Congress at the time only makes matters worse, prosecutors said.
"The circumstances of Collins’s insider trading are unique: at the time he committed that crime, he held not only the trust of Innate’s shareholders, but also the trust of the public as their elected official," they wrote. "He violated both trusts when he committed insider trading and when he then committed a second crime to cover it up."
More than 100 of Collins' family members, friends and colleagues sent letters to the judge pleading for leniency, but in their filing, prosecutors noted that dozens of Collins' constituents also wrote to U.S. District Court Judge Vernon S. Broderick.
"The numerous letters that Congressman Collins’s former constituents have submitted to the court expressing their deep frustration and disappointment with Collins’s secret illegal behavior reinforce the need for a substantial period of incarceration to promote respect for the law," the prosecutors wrote.
Broderick filed another half-dozen of those letters in the court docket late Monday, including one from the Buffalo Chapter of the National Lawyers Guild, a progressive legal organization.
"Imposing the maximum sentence on him will serve as a warning to other public officeholders," the lawyers said.
The prosecutors agreed.
"In committing insider trading and later lying to federal agents to cover it up, and in continuing to actively serve in the House of Representatives during that time period, Collins came to embody the cynical idea that those in power who make the laws are not required to follow them," they wrote. "It is critically important that the sentence imposed on Congressman Collins drive home the message that status does not constitute a basis for leniency."