Grimm pleads guilty but won't quit

New York GOP Rep. Michael Grimm won’t resign from office despite pleading guilty to one felony federal charge of filing false tax returns for a restaurant he owned, raising a challenge for Speaker John Boehner and other Republican leaders if they seek to force him from office.

“No, as I said before as long as I am able to serve, I will serve,” Grimm defiantly told reporters in a press conference after leaving a federal court in Brooklyn.


Grimm acknowledged he had spoken with Boehner but he offered no details on their conversation. Boehner has so far refused to comment on the Grimm case.

Grimm could be expelled from Congress following a vote by the full House, but those proceedings could take weeks or even months, allowing Democrats to pummel GOP leaders over the issue.

House Minority Leader Nancy Pelosi (D-Calif.) and the Democratic Congressional Campaign Committee — seeing an opportunity to pick up a competitive seat — have already called on Boehner to force Grimm to resign.

“Rep Michael Grimm is now a self-admitted felon,” Virginia Democratic Rep. Gerry Connolly said on Twitter. “He must resign his seat in Congress or be expelled. No convicted felons in the House.”

Grimm, a 44-year-old former FBI agent, also admitted to lying during a civil case involving a Manhattan restaurant, Healthalicious, and his treatment of employees there, as well as other criminal violations, although he pleaded guilty only to tax evasion for the years 2007 to 2010, according to court documents.

Grimm will be sentenced on June 8, U.S. District Judge Pamela Chen announced.

Under federal sentencing guidelines, Grimm could face 24 to 30 months in prison. However, Justice Department prosecutors have not made any recommendation on how long they would like to see the two-term lawmaker spend behind bars. Grimm’s lawyers are expected to seek a far shorter prison term of 12 to 18 months, although Chen is not bound by any of these recommendations and could forgo any prison term for Grimm.

Grimm was hit with 20-count indictment in April after a long probe by the FBI, IRS and other law-enforcement agencies. Initially, federal investigators looked into allegations of campaign-finance violations involving Grimm and an influential rabbi, but no charges were ever filed as part of that probe. DOJ officials note that today’s plea deal does not prevent the Justice Department from bringing further charges against Grimm, although it is unclear if the campaign-finance investigation is still ongoing.

The case against Grimm had been brought by Loretta Lynch, the U.S. attorney for the Eastern District of New York. Lynch has been nominated by President Barack Obama to become attorney general.

“With today’s guilty plea, Michael Grimm has admitted that while running his business, he chose lies and deception over honest dealings with federal and state authorities as well as his own employees,” Lynch said in a statement. “This guilty plea makes clear that we and our partners in the FBI and IRS will vigorously investigate fraud where we find it, and no one is above the law.”

According to the plea agreement between Grimm and DOJ, he engaged in a long-term effort to illegally lower the tax bill for his restaurant, including paying some workers only in cash to keep them off Healthalicious’ books.

Grimm “concealed over $900,000 in the restaurant’s gross receipts from an accountant who prepared and filed tax returns on behalf of Healthalicious,” the plea agreement states. “Additionally, [Grimm] did not report to the IRS and the [New York State] Tax Department the cash or ‘off the books’ wage he paid to Healthalicious workers, thereby lowering the restaurants federal and state payroll taxes. Some Healthalicious employees received at least part of their wages in cash. Other employees received all their wages in cash.”

Grimm also lied under oath during a 2013 civil case related to Healthalicious, the lawmaker admitted during Tuesday’s court hearing.