Thread: 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.



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/

Congress Can't Prevent Michael Grimm From Taking Seat In House

Posted: 12/22/2014 7:16 pm EST Updated: 17 minutes ago

WASHINGTON -- Rep. Michael Grimm (R-N.Y.) may be about to plead guilty to a felony, but there's nothing Congress can do to stop him from taking his seat in the House early next month.

"The only time there would be a clash between his ability to serve and his conviction, if he gets one, would be if he has to leave and enter a federal facility," said Stan Brand, a former top lawyer for the House. "If he’s not sentenced to incarceration, that issue never comes up."

Grimm was hit with a 20-count federal indictment before he easily won re-election in November, and he will reportedly plead guilty to one count of federal tax evasion at a 1 p.m. court hearing on Tuesday.

Grimm, a former Marine and FBI agent, said during the campaign that he would resign if unable to serve, presumably a reference to the possibility of his being imprisoned. The charge to which he is expected to plead guilty carries significant potential jail time, but the sentence would be up to the judge.

The New York Daily News reported Monday that if Grimm is not sentenced to jail time, he will argue that he should serve in Congress.

Brand said Grimm would have that right.

"The framers felt the ultimate choice of the people in the district is what prevails, and if they want a convicted felon, that’s their right," Brand said. "We can all say 'Oh, isn't it terrible,' but if that’s what the people of Staten Island want, then they’re entitled to have that."

"It's great grist for the comedy shows, but legally and constitutionally, hey, welcome to America," Brand added.

Of course, House Speaker John Boehner (R-Ohio) can make life difficult for Grimm, and can try to convince him to quit.

House leaders have called on members to resign for lesser offenses. Boehner's office was not immediately prepared to comment Monday.

The House Committee on Ethics could also start its own action against Grimm, with the possible outcome of recommending his expulsion, which would require a vote of the House.

"Even after that," said Brand, "if they decided not to impose the extreme sanction of expulsion, he would be free to serve."

And that's the way the founders of the nation wanted it, he added.

"Grimm was re-elected by his constituents with full knowledge that he had been charged," said Brand.

So when the House starts work on Jan. 6, Grimm can be there if he wants to be, and if he hasn't shuffled off to a federal penitentiary.

http://www.huffingtonpost.com/2014/1...n_6369132.html

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/

1/28/14

http://www.alipac.us/f9/rep-michael-...porter-296522/

Rep. Michael Grimm to resign after admitting to tax evasion, report says

Published December 29, 2014 FoxNews.com

U.S. Rep. Michael Grimm plans to resign, the New York Post reported Monday, one week after the Staten Island congressman admitted to federal tax evasion.

Grimm, who was re-elected to a third term representing New York's 13th district in November, is expected to resign sometime this week, a source told the Post.

Grimm, a Republican, pleaded guilty on Dec. 23 in federal court in Brooklyn to one count of aiding in the filing of a tax return. He had been accused of hiding more than $1 million in sales and wages while running a Manhattan health-food restaurant.

Under the plea agreement, he could face up to three years in federal prison. His sentencing is set for June 8.

Following his guilty plea, Grimm said he planned to continue serving in the Congress.

"As long as I'm able to serve, I'm going to serve," he said last week. "As of right now I'm still in a capacity to serve, and that's exactly what I plan on doing."

http://www.foxnews.com/politics/2014...imm-to-resign/

I wonder when Charlie Rangle will resign..

My guess is never. FWIW, there's been a lot of buzz about my assemblywoman replacing him, which wouldn't be the worst choice in the world, all things considered. She gave a pretty decent speech against the NY State Dream Act a while back:

http://american-rattlesnake.org/2014...merican-dream/

Gov. Andrew Cuomo sets special May election to replace Michael Grimm in Congress

Updated February 20, 2015 5:12 PM
By MATTHEW CHAYES. AND YANCEY ROY matthew.chayes@newsday.com,yancey.roy@newsday.com

Rep. Michael Grimm (R-Staten Island) leaves federal court in Brooklyn on Monday, April 29, 2014. Photo Credit: Charles Eckert


Gov. Andrew M. Cuomo Friday set May 5 as the special-election date when voters will pick a replacement for disgraced Rep. Michael Grimm, the Staten Island Republican who last month resigned after pleading guilty to tax evasion.

Cuomo's decision to schedule a special election came three days after a federal judge ordered him to either do so or explain why he could not set the date. Friday was the judge's deadline.

Most Popular

• Driver in fatal wreck faces life in prison
• FDNY: Fallen mirror injures 1 at restaurant
• $3.6B LaGuardia revamp delayed 3 months
• Data: Stop-and-frisks down 80% in SI precinct
• Mayor keeps distance from pricing plan

Last month, the local Republicans picked Dan Donovan -- now the island's district attorney -- to run for the seat, and he is favored to win. The Democrats haven't made their choice yet, but sources say the party is expected to choose Vincent Gentile, a city councilman who represents southwest Brooklyn.

The Democrats' decision will be made early next week by the party chairman John Gulino, said executive director Tom Feeney.

A spokesman for Gentile declined to comment, and Donovan's spokeswoman didn't immediately return a message seeking comment.

John Antoniello, chairman of the Staten Island GOP, said he is "pretty confident" in Donovan's chances for victory.
New YorkDisgraced NY politicians

"He's a good man," Antoniello said. "He has a good base here."

Donovan oversaw the grand jury that declined to indict an NYPD cop in the choking death of Eric Garner.

Republicans had pushed for Cuomo to set an election date for the seat, which has been in GOP hands for the 32 of the past 34 of 34 years.

"It is extremely important that we have a representative in Congress, because we're still suffering from the aftermath of Hurricane Sandy, and a lot of it has to do with federal government," said Assemb. Nicole Malliotakis (R-Staten Island). "It's important that we have somebody at the table."

May 5 will also be the date for a special election to replace Assemb. Karim Camara (D-Brooklyn), who resigned to join the Cuomo administration. The governor indicated a day earlier he was awaiting Camara's resignation -- which became effective midnight Thursday -- so as to set the two elections on the same day.

Camara is going to be in charge of a new agency, the Office of Faith-Based Community Development Services.

http://www.newsday.com/news/new-york...ay-5-1.9959772

7/17/15

BREAKING NEWS

FORMER NY REP. MICHAEL GRIMM SENTENCED TO 8 MONTHS IN PRISON FOR TAX-RELATED CRIMES

Ex-Rep. Grimm sentenced to 8 months in prison in tax evasion case

Published July 17, 2015 Associated Press

Former New York Congressman Michael Grimm has been sentenced to eight months in prison for tax evasion.

The Staten Island Republican pleaded guilty late last year to aiding in the filing of a false tax return.

Federal prosecutors in Brooklyn had asked the judge to give Grimm at least two years behind bars at the sentencing on Friday. His lawyers had sought probation.

The 45-year-old Grimm won re-election in November but resigned after his guilty plea.

http://www.foxnews.com/politics/2015...-evasion-case/