Exclusive: GOP lawmaker talked stocks with colleagues

Exclusive: GOP lawmaker talked stocks with colleagues
© Greg Nash

Rep. Chris Collins (R-N.Y.) has boasted about how much money he’s made for other members of Congress by tipping them off to an Australia-based pharmaceutical company in which he is the largest stockholder, two GOP lawmakers told The Hill.

Collins, President Trump’s chief defender and unofficial spokesman on Capitol Hill, told a group of House GOP colleagues over dinner earlier this year that he had urged colleagues to invest in Innate Immunotherapeutics and made them plenty of money in the process, said one GOP lawmaker who was present for the conversation.

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“He said that he’s made members money,” the GOP lawmaker told The Hill.

“Members of Congress?” a reporter asked. 

“Yeah, on his stock tip,” the lawmaker replied.

“If you get in early, you’ll make a big profit,” Collins reportedly told another group of House Republicans last summer, according to a second GOP lawmaker who was part of the same 2012 class as Collins.

Asked if he ever heard Collins brag about making colleagues money, the second lawmaker replied: “I’ve heard those kinds of phrases.”

Collins had already won negative headlines after reporters in January overheard him bragging about “how many millionaires I’ve made in Buffalo the past few months.”

The Buffalo News reported that many in the city’s business elite had bought stock in the drug company after hearing from Collins.

Now the focus is shifting to Collins’s conversations with colleagues on Capitol Hill.

The dinner discussion on Capitol Hill wasn’t the only time Collins brought up the Australian company in Washington.

Half a dozen Republican lawmakers interviewed for this story said they have heard Collins talking up Innate Immunotherapeutics at official meetings and in informal settings on the Hill.

A third House GOP lawmaker told The Hill that Collins personally pitched him on buying Innate stock, though the lawmaker didn’t take his advice.

In an extended interview in the Speaker’s lobby, just off the House floor, Collins categorically denied that he had ever recruited members of Congress to buy Innate stock or bragged about making them money.

“I never once talked about that. … I’ve never encouraged anyone to buy the stock. Ever,” Collins said.

“I’ve presented opportunities in Buffalo. I’ve said, ‘Here’s an opportunity. Listen. Read. Study. Make a decision.’ That’s the only thing I ever did, and that was in Buffalo.”

Collins — whose net worth is as much as $66 million, according to OpenSecrets.org, making him one of the wealthiest members of Congress — said he had no regrets about talking about Innate to colleagues and others in Washington. And he said it was no secret that people who invest in the company probably will get rich.

Innate’s drug just completed a Phase 2B clinical trial, and the firm hopes to sell off the product later this year, Collins said.

“There are a dozen Big Pharma companies interested,” Collins said. “I think this drug could be on the market in two years, potentially, which is life-saving and family-saving.

“I talk about it at every turn, just like you talk about your kids hitting a home run and your daughter getting into law school,” he continued. “In all the things that I’ve done in my business career, I’m most proud of this.”

 

Numerous conversations

Several House colleagues said Collins’s constant talk about the company is inappropriate for an elected official.

One lawmaker, who hails from the Midwest, said he recalls Collins bragging about how much money he’s made from Innate during a lunch with colleagues. One’s personal wealth is a private matter “where I come from,” the source said.

And a fifth GOP lawmaker said the western New York Republican had mentioned Innate in “numerous conversations,” including during an official meeting in the Capitol about finding a cure for cancer.

While Collins had done nothing wrong, the lawmaker said, his remarks at the meeting raised some eyebrows in the room.

“Anytime you talk about business interests, you always have to be sensitive to how that is portrayed by others. You may be giving the most innocent and honest assessment, but it’s also how people perceive it; things sometimes get lost,” the fifth lawmaker told The Hill.

“If I was on the other side receiving that, I could see where people would say, ‘That’s a little too close.’ ”

Collins first invested in Innate Immunotherapeutics, which has developed a drug to fight advanced multiple sclerosis, about 15 years ago. He said he’s raised money for the company during tough times and has earned a spot on its board of directors.

Last August, he purchased an additional 4 million shares. On Jan. 27, the stock hit an all-time high of $1.83 per share, but it was trading at 74 cents per share on Wednesday.

 

Ethics probe

House ethics investigators last month began probing Collins for his role in recruiting investors to buy stock in the Australian firm after several complaints were filed alleging insider trading.

The Stop Trading on Congressional Knowledge (STOCK) Act, passed by Congress in 2012, explicitly bars members of Congress from trading stocks using insider information.

In January, The Wall Street Journal reported that Trump’s pick for Health and Human Services secretary, then-Rep. Tom Price (R-Ga.), had received a personal invitation from Collins last summer to buy between $50,000 and $100,000 of Innate stock at a discounted rate.

Collins’s chief of staff, Michael Hook, and former Rep. Bill Paxon (R-N.Y.), now a lobbyist, also bought Innate stock at the discounted 18 cents-per-share rate.

Price, who was confirmed by the Senate on Feb. 10, said during his confirmation hearing that his stock purchase wasn’t a “sweetheart deal.” But the Journal found that Price was one of fewer than 20 U.S. investors who were able to purchase the Innate stock at the discounted price.

Five other GOP lawmakers — Reps. Mike Conaway and John Culberson, both of Texas, Doug Lamborn (Colo.), Billy Long (Mo.) and Markwayne Mullin (Okla.) — have also purchased shares of Innate this year. But most have said they discovered the stock through media reports and denied they received a stock tip from Collins.

Critics, however, say Collins’s incessant chatter about Innate Immunotherapeutics has blurred the line between the people’s business and the congressman’s private business interests.

“We can’t get him to meet with us even during recess. He’s using any extra time he has to work on his wealth and his prestige with his buddies,” said Cecily Molak, a retired attorney and Republican constituent of Collins who filed a congressional ethics complaint against him. “I find it disturbing. Infuriating. It is a misuse of his position because he is ignoring the people he’s supposed to serve.

“Instead, he is serving his own interest. It’s clearly wrong.”

 

An intriguing stock

One Southern GOP House lawmaker said he’s spoken with Collins about Innate “on more than one occasion.” The lawmaker was so intrigued by the opportunity, he and his spouse discussed whether they should buy the stock.

If the drug is brought to market, it could generate “billions of dollars in profits,” the lawmaker said.

“I knew about his company and heard about his clinical trials. Then I actually talked to my wife about it. ‘Should we buy some stock? This thing’s gonna explode,’ ” the lawmaker recalled. “We decided, ‘No, we can’t. It’s just too untenable politically.’ ”

The Innate Immunotherapeutics stock wasn’t too toxic for other members of Congress.

Mullin purchased between $100,000 and $250,000 of Innate shares on Jan. 12 of this year, according to a House financial disclosure report flagged by The Daily Beast.

“It was all over the news for Price,” Mullin, who is close to Collins, said in an interview Tuesday. “I didn’t know it had anything to do with Chris. Not at all. Of course, we’ve talked about it since then, but not before I purchased the stock.”

Several other GOP lawmakers bought Innate stock after Jan. 24, the day Price’s stock purchases came under intense scrutiny during his Senate confirmation hearing.

Both Culberson and Conaway, the House Agriculture Committee chairman, bought between $1,000 and $15,000 of Innate shares on the same day, Jan. 26. Conaway bought more stock on Feb. 3.

“It’s public knowledge now,” the Southern lawmaker said. “It’s not insider information if everyone knows about it.”

 

First to endorse Trump

First elected in 2012, Collins had been a backbencher in the House before the rise of Donald TrumpDonald John TrumpAssange meets U.S. congressman, vows to prove Russia did not leak him documents A history lesson on the Confederacy for President Trump GOP senator: Trump hasn't 'changed much' since campaign MORE. Collins became the first member of Congress to publicly endorse Trump in the GOP primaries, and he quickly became a top campaign surrogate on cable TV. Just days after Trump’s election, Collins declared to reporters in the Capitol that he had been designated as the Trump transition team’s liaison to Congress.

With the White House besieged by multiple probes into possible collusion between the Trump campaign and Russia, Collins has remained a loyal and steadfast defender of the president and his administration. It’s made the Empire State congressman, a member of the moderate Tuesday Group, a 2018 Democratic target, even though Trump trounced Democratic nominee Hillary ClintonHillary Rodham ClintonAssange meets U.S. congressman, vows to prove Russia did not leak him documents High-ranking FBI official leaves Russia probe OPINION | Steve Bannon is Trump's indispensable man — don't sacrifice him to the critics MORE in his suburban district 60 percent to 35 percent.

Collins is a member of the influential Energy and Commerce Committee, which has jurisdiction over health issues. Specifically, he serves on the panel’s Health and Oversight and Investigations subcommittees.

In the interview, Collins insisted he never once advised or encouraged anyone in Washington or back home in Buffalo to buy the stock.

Collins declined to comment on whether he or his chief of staff had been interviewed by ethics investigators. But he dismissed the investigation as a “witch hunt” launched by Sen. Elizabeth WarrenElizabeth WarrenWarren: Education Dept lawyer may have violated conflict-of-interest laws Congress should think twice on the Israel Anti-Boycott Act Sanders plans to introduce single-payer bill in September MORE (D-Mass.) and other Democrats.

He argued that the reporters who overheard him bragging about the “millionaires” he’s made in Buffalo took him out of context. Collins said he was having a “private conversation” with a friend and investor from Buffalo, even though Collins took the call in the Speaker’s lobby.

“He was joking to me. He said, ‘You’ve made a lot of [millionaires]’ — at that moment in time, 600,000 shares made you a millionaire. These are people who maybe bought a million shares for $100,000,” Collins explained. “He was joking to me and I joked back to him, ‘Yeah, I’ve made a lot of millionaires in Buffalo,’ because they invested.”