Rep. John Culberson
Two members of Congress from Texas — Republican U.S. Reps. Mike Conaway of Midland and John Culberson of Houston — purchased stock in a company last year that is now at the center of insider trading charges against one of their colleagues, U.S. Rep. Chris Collins, R-New York.
Collins, best known as the first congressman to back Donald Trump’s 2016 presidential bid, was indicted Wednesday by federal prosecutors and charged with securities fraud, wire fraud and making false statements to the FBI. The indictment stems from his involvement in an Australian biotech firm called Innate Immunotherapeutics, and it alleges he passed non-public information about the company to his son, Cameron, who then used it to purchase stock and tip off others.
Conaway and Culberson are not named in the indictment and face no allegations of wrongdoing. But they were among several of Collins’ colleagues who purchased shares of Innate last year and faced some scrutiny for it, especially after reports surfaced that Collins was seeking to convince them and other associates to invest. Collins, who has denied any wrongdoing, was already being investigated by the House Ethics Committee before the indictment was unveiled Wednesday.
Both Conaway and Culberson bought stock in Innate on Jan. 26, 2017, worth between $1,001 and $15,000, according to personal financial statements filed with the House clerk. Their purchases came two days after a contentious confirmation hearing for U.S. Rep. Tom Price, R-Georgia, then Trump’s nominee for secretary of health and human services, during which he was questioned over his own investment in Innate. Conaway purchased more of the stock on Feb. 3, 2017, again valued at between $1,001 and $15,000.
Culberson sold his stock on June 12, 2017 — 10 days before Chris Collins is accused of sharing the non-public information with his son. Conaway, meanwhile, dumped all his shares in November 2017, according to a spokesperson for his office.
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The fallout from the indictment could be more of a political problem for Culberson, who is among national Democrats’ top three targets in Texas this fall. The Democratic Congressional Campaign Committee singled out Culberson in a statement after the charges against Collins were revealed, and his opponent, Lizzie Pannill Fletcher, said in her own statement that the indictment “raises serious questions.”
“Congressman Culberson must explain why he, along with a small group of Republican lawmakers, bought stock in an obscure Australian biopharmaceutical company that is at the center of an insider trading scandal,” Fletcher said. “If Congressman Culberson used his position of power, along with access to material nonpublic information, in an effort to benefit himself personally then Congressman Culberson will have confirmed he is exactly what is wrong with Washington.”
See here for some background. In a different year, with a less-hostile political environment and a non-threatening opponent, Culberson could easily shrug this off. This year, not so much. Even if you yourself are not being accused of wrongdoing, the close association with a colleague who just got busted on federal charges and a Trump administration official who resigned amid a cascade of ethical scandals is not a good look. Good luck coming up with a satisfactory explanation for it all. The Chron has more on the Culberson angle, and for more on the Chris Collins arrest see Daily Kos, Mother Jones, ThinkProgress, and Political Animal.
It’s entirely possible that Culberson was taken advantage of by others. I’ve met the man. He’s not exactly smart. In some ways, he reminded me of Forrest Gump. And seriously, who shows up to a small meeting at an outdoor venue in Houston in the middle of Summer in a suit?
I’m certainly no fan of Culberson, but I’m hard pressed to figure out what he did wrong here.