Rep. Michael Grimm R-NY To Plead Guilty To $1 Million Tax Fraud
NY Rep. Michael Grimm To Plead Guilty To $1M Tax Fraud
Rather than go to trial as he promised, U.S. Representative Michael Grimm of Staten Island, New York is set to plead guilty on tax charges related to his Manhattan health food restaurant Healthalicious. After a federal investigation, Rep. Grimm was hit with a 20-count federal indictment in April of 2014. The indictment claims that he failed to pay taxes on $1 million in income and that he hired illegal workers. The charges are serious, even if he weren’t an elected official.
Among other things, the indictment claims that Mr. Grimm under-reported sales and wages of over $1 million, paid workers in cash under the table, and kept two sets of payroll ledgers. Mr. Grimm allegedly used cash to skimp on payroll taxes, income taxes and workers’ compensation premiums. The immigration status of his workers has also been questioned.
Part of the charges also relate to his response to questions.
When asked in a deposition under oath, Rep. Grimm is charged with falsely testifying that he did not pay any of his workers in cash. Those statements were made in the course of a lawsuit by former Healthalicious employees, who claimed they were not paid minimum wage.
http://blogs-images.forbes.com/rober...2014/11/12.png
Initially, Rep. Grimm called the indictment a politically motivated witch hunt, and he vowed to fight the charges. And he won re-election to the House in November, beating challenger Domenic Recchia, Jr. to maintain his seat in New York’s 11th Congressional District. He even got 53 percent of the vote despite the charges against him. But now he is poised to plead guilty.
It is not clear whether Rep. Grimm will seek to maintain his seat in Congress, though he could face discipline from the House of Representatives, including expulsion. It does not appear that he would face automatic expulsion. Notably, these charges do not include allegations of campaign finance violations and as serious as they are, only relate to Mr. Grimm’s role with Healthalicious.
But there have been fundraising concerns too. Concerning Rep. Grimm’s fundraising, a former fundraiser for his campaign named Diana Durand has already pleaded guilty to funneling illegal contributions to his 2010 campaign. Rep. Grimm is a former FBI agent, and represents parts of Staten Island and Brooklyn.
As for the pattern of keeping two sets of books and paying in cash, both irregularities feature commonly in tax evasion cases.
For example, the president and founder of Detroit-based Happy’s Pizza, Happy Asker, was recently found guilty of 32 tax crimes and conspiracy to defraud the United States. The jury took 4½ hours to convict on three counts of filing false returns, 28 counts of aiding and assisting the filing of false returns for Happy’s Pizza franchises, and one count of engaging in a corrupt endeavor to obstruct and impede the administration of the Internal Revenue Code.
In that case, two sets of books and cash payments also featured prominently.
http://www.forbes.com/sites/robertwo...-1m-tax-fraud/
U.S. Rep. Michael Grimm pleads guilty to fleecing undocumented workers, political fut
U.S. Rep. Michael Grimm pleads guilty to fleecing undocumented workers, political future in doubt
Published December 23, 2014
Fox News Latino
NEW YORK (AP) – A New York congressman and retired FBI agent pleaded guilty Tuesday to a federal tax evasion charge, in a case that involves paying immigrant workers, some of them undocumented, in cash in order to evade payroll, income and sales taxes.
Grimm entered a guilty plea to one count of aiding in the filing of a false tax return. He had been set to go to trial in February on charges of evading taxes by hiding more than $1 million in sales and wages while running a Manhattan health-food restaurant.
Grimm, joined in court by two attorneys, acknowledged sending his accountant underreported receipts and using the leftover money to pay employees off the books and cover other expenses.
Sentencing was scheduled for June 8. Prosecutors said a range of 24 to 30 months in prison would be appropriate, while the defense estimated the appropriate sentence as between 12 and 18 months.
News of the planned plea quickly brought pressure from Democrats for Grimm to resign his seat.
The Democratic Congressional Campaign Committee said in a statement before his court appearance Tuesday that it was "past time for Michael Grimm to go," calling his continued presence in Congress "a disservice to the people of Staten Island and Brooklyn and a stain on the institution."
The DCCC and House Minority Leader Nancy Pelosi, D-Calif., called on House Speaker John Boehner, R-Ohio, to ensure Grimm's departure.
Boehner has forced other lawmakers to resign for lesser offenses. He quickly orchestrated the 2011 resignation of Rep. Chris Lee, R-N.Y., a married lawmaker who responded to a personal ad by emailing a shirtless photograph of himself to another woman.
Boehner does not plan to comment on Grimm's situation until the two discuss it, Boehner spokesman Michael Steel said.
Asked in October whether he would resign if found guilty, Grimm responded, "Certainly, if I was not able to serve, then of course I would step aside."
But if Grimm refuses to resign, it would take a rare vote by his fellow lawmakers to expel him from the House. The last member to be expelled was James Traficant, D-Ohio, who was kicked out of Congress in 2002.
A former Marine and FBI agent, Grimm got to Congress by scoring an upset win over first-term Democratic Rep. Michael McMahon in 2010. Grimm won re-election in November, little more than six months after he was indicted.
According to an indictment, the tax fraud began in 2007 after Grimm retired from the FBI and began investing in a small Manhattan restaurant called Healthalicious. The indictment accused him of underreporting more than $1 million in wages and receipts to evade payroll, income and sales taxes, partly by paying immigrant workers, some of them in the country illegally, in cash.
When he was initially charged, Grimm called the case "a political witch hunt" and declared, "I'm a moral man, a man of integrity."
The case stemmed from an investigation of Grimm's campaign financing. He was never charged with any offense related to his campaign, but a woman romantically linked to him pleaded guilty in September to lining up straw donors for his 2010 run. Grimm has denied knowledge of any fundraising improprieties.
Grimm, 44, made headlines in January after telling a local cable TV news station reporter he wanted to throw the journalist off a balcony in the Capitol for asking about the campaign finance inquiry.
An independent advisory office recommended that the House Ethics Committee investigate the balcony incident. The ethics panel deferred its investigation into Grimm while the Justice Department case was ongoing.
If Grimm doesn't resign, the panel is sure to address the case next year.
http://latino.foxnews.com/latino/new...l-tax-evasion/
