Lamborn says investigators haven't contacted him over stock that led to NY congressman's indictment

His office says he was told no inside knowledge
Posted at 4:31 PM, Aug 10, 2018
and last updated 2018-08-10 18:31:38-04

DENVER – U.S. Rep. Doug Lamborn, R-Colo., hasn’t been contacted by federal investigators in regards to the stock he owned in an Australian biotechnology company that is at the center of the indictment of New York Congressman Chris Collins earlier this week, his office tells Denver7.

Collins, R-N.Y., was indicted Wednesday on insider-trading charges, among others, and accused of tipping off others who owned stock in Innate Immunotherapeutics, of which he was a board member and top shareholder, before the results of a failed drug trial became public last June.

The company’s stock crashed after the results were made public, causing most investors to lose the money they had put into the company—including Collins. But prosecutors say Collins helped his friends and family members avoid hundreds of thousands of dollars in losses. Collins has denied all of the allegations.

As was previously reported by The Denver Post and other national news outlets, Lamborn was among several members of Congress who owned stock in the company. Financial disclosure forms show he held shares of the company through a Scottrade IRA in both 2016 and 2017.

The 2016 filing shows he held up to $1,000 worth of shares in the company, though it does not make clear when the purchase was made. The 2017 filing shows Lamborn bought more shares through his IRA, totaling between $15,0001 and $50,000, on Jan. 24, 2017.

The drug trial was made public on June 26, after which the stock crashed. Lamborn’s financial disclosure form shows he sold his shares of the stock the next day, June 27, for “less than $1,000,” he wrote.

Lamborn previously told Politico he “took a bath” on the stock.

Savannah Frasier, a spokesperson for Lamborn, responded earlier this week to questions from Denver7 regarding the insider trading allegations levied against Collins and whether Lamborn had been told any inside information.

Frasier said that Lamborn bought the stock after it received media attention in 2016 over trials for the multiple sclerosis treatment—something he also told Politico earlier this year, when he said, “[Collins] wasn’t being pushy. And I figure I’m a big boy and I can make my own decisions. Even if they’re wrong decisions.”

But she said that Lamborn lost “most of his investment” when the stock tanked in late June 2017—which is backed up by the financial disclosure form. She said that Lamborn never received any insider knowledge from Collins.

“At no time did Congressman Collins give insider information to Congressman Lamborn. Despite the loss of most of his money, Congressman Lamborn does not blame anyone else for his loss,” Frasier said.

She also confirmed that federal investigators have not contacted Lamborn. In addition to the Justice Department indictment, Collins and his son also face a civil action brought by the Securities and Exchange Commission (SEC).

“[Lamborn] has not been contacted by any investigator in this matter but would be happy to repeat the above sequence of events to any proper authority,” Frasier said.

While at least five other members of Congress also held shares in Innate Immunotherapeutics, according to Roll Call, none have publicly said they have been contacted by investigators.

When asked if any other members of Congress were under investigation in regards to Collins’ indictment Wednesday, Geoffrey Berman, the U.S. attorney for the Southern District of New York, said, “That is not an aspect of this indictment. No comment.”

Lamborn, a six-term Republican congressman from Colorado’s 5th congressional district, faces Democrat Stephany Rose Spaulding in November after he handily defeated four Republican challengers in June’s primary. There are also two write-in candidates.