NY congressman Chris Collins was arrested Wednesday and charged with conspiracy to commit securities fraud.
Last August, the House Ethics Committee took up an inquiry into Collins and allegations that he had shared nonpublic information about the company, in violation of House rules, standards of conduct, and federal law. His son, Cameron Collins, and Stephen Zarsky, the father of Cameron's fiancee, were also indicted on the same charges.
Collins' lawyers noted in a statement that the government has not said the congressman traded any shares of the stock. Collins was the first sitting member of Congress to endorse Donald Trump's presidential bid.
According to the indictment, after Collins learned a trial regarding a drug to treat multiple sclerosis failed, he contacted his son, who traded on the information.
The congressman, through his attorneys, denied any wrongdoing.
Prosecutors say the charges relate to a scheme to gain insider information about a biotechnology company headquartered in Sydney, Australia, with offices in Auckland, New Zealand.
In a statement, the congressman's legal counsel addressed the accusations, expressing confidence he will be vindicated and exonerated in court.
On the day after the trial results were released, the company's stock lost 92 percent of its value.
Collins, who was the first sitting member of Congress to endorse Donald Trump's presidential bid, surrendered Wednesday morning at his attorney's office in Manhattan, according to the Federal Bureau of Investigation.
According to the documents, the congressman did not make trades himself, because he was under investigation by the Office of Congressional Ethics and his shares were traded on the Australian stock exchange, which had halted trading in Innate stock.