Former Republican Congressman Chris Collins pleaded guilty to one count of conspiracy to commit securities fraud and another count of lying to the FBI in an insider trading scandal involving a small Australian biotech company.
The New York Republican's Oct. 1 guilty plea came hours after his resignation from Congress was made official on the floor of the U.S. House of Representatives.
Collins could face up to 10 years in prison. He is scheduled to be sentenced Jan. 17, 2020.
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Under his plea agreement, Collins said he would not appeal any sentence less than 57 months.
He initially was facing 11 counts, including charges of wire fraud.
Collins submitted his resignation to House Speaker Nancy Pelosi, D-Calif., on Sept. 30, shortly after filing a notice with the U.S. District Court for the Southern District of New York that he intended to change his plea.
As a member of Congress, Collins helped write the laws of the nation, but "he acted as if the law did not apply to him," said Geoffrey Berman, the U.S. attorney for the Southern District of New York.
"Today's plea is a reminder that all citizens stand equal before the law in our criminal justice system," Berman said in an Oct. 1 statement.
The former lawmaker's co-conspirators — the congressman's son Cameron and Stephen Zarsky, the father of the younger Collins' girlfriend — are expected to plead guilty Oct. 3.
The case
On June 22, 2017, Collins received an email that a multiple sclerosis drug being developed by Innate Immunotherapeutics Ltd., now Amplia Therapeutics Ltd., had failed a critical phase 2B clinical trial, prosecutors said.
At that time, Collins was on Innate's board and was its largest shareholder. He was obligated to keep the trial results secret until Innate publicly released them.
Instead, in breach of those duties, the lawmaker tipped his son, Cameron, also a substantial Innate shareholder, about the study's failure so that he could sell his shares and inform others, including Zarsky and some of his family members and a friend, ahead of the company's public disclosure, prosecutors said.
Collins made the calls to his son about the poor study results from the White House lawn, where he was attending the annual picnic for members of Congress.
In total, Collins' son and Zarsky and his family members avoided over $768,000 in losses that they would have otherwise incurred if they had sold their stock in Innate after the failed study results were made public.
Prosecutors said Collins, his son and Zarsky also lied to the FBI on April 25, 2018, in an attempt to cover up their participation in the insider trading scheme.
Open seat
New York Gov. Andrew Cuomo, a Democrat, is expected to call a special election, though the timing is uncertain.
Speaking on Oct. 1 on New York radio station WAMC, Cuomo said he did not want to wait until 2020 and was "inclined to fill the vacancy sooner rather than later."
Cuomo said he doubted he could call an election for this coming November.
"I have to review the law," he said.
Collins' last Democratic rival, Nate McMurray, has already said he would run.
New York Lt. Gov. Kathy Hochul's name has also surfaced as a potential contender. She is also a Democrat.
While Cuomo said he would like to keep Hochul in New York's government, he said he also does not want the seat to go to another Republican "water-carrier" for President Donald Trump.
Collins was one of Trump's biggest supporters in Congress and was among the first to back the former TV personality.

Chris Collins