Staten Island Rep. Michael Grimm indicted on tax fraud charges

michael grimm fbi
Staten Island Rep. Michael Grimm was taken into FBI custody Monday morning.
Credit: Alex Wong/Getty Images

Staten Island Rep. Michael Grimm pleaded not guilty on Monday to federal charges that he defrauded the government of taxes on his former health food restaurant.

Prosecutors allege Grimm underreported over $1 million of wages and sales at the Upper East Side restaurant, called Healthalicious. Authorities said some workers at the restaurant, which Grimm ran from 2007 to 2010, were undocumented.

The Republican congressman dismissed the charges as part of a “political witch hunt” designed to “assassinate” his character.  He said he has no plans to resign because of the charges.

“We’re going to fight tooth and nail until I am fully exonerated,” Grimm said shortly after leaving Brooklyn federal court.

Grimm, who represents parts of Staten Island and Brooklyn, was arrested after surrendering to the FBI shortly before 7 a.m. Monday. After he pleaded not guilty, Grimm was released on $400,000 bond and ordered to surrender his passport and firearm.

He was charged with mail, wire and health care fraud, filing false tax returns, perjury, obstruction of an official proceeding and hiring and employing unauthorized aliens in connection with Healthalicious, according to the 20-count indictment unsealed Monday.

“Michael Grimm never met a tax he didn’t lie to evade,” U.S. Attorney Loretta Lynch said.

Prosecutors allege Grimm hired and paid undocumented Healthalicious employees with cash, falsifying payroll records that underreported gross receipts of the business by $1 million. He was charged with cheating sales, income and payroll taxes while he ran the food shop.

According to the indictment, Grimm also underpaid workers’ compensation premiums and lied under oath during a civil suit brought by former employees alleging wage violations.

FBI assistant director-in-charge George Venizelos said Grimm, a former federal agent himself, should have known better.

“As a former FBI agent, Representative Grimm should understand the motto: fidelity, bravery and integrity. Yet he broke our credo at nearly every turn. In this 20-count indictment, Representative Grimm honored a new motto: fraud, perjury and obstruction,” Venizekos said.

The congressman faces 20 years in prison for each mail and wire fraud charge. He is expected in court again next month.

Grimm recently made headlines for threatening to throw a NY1 reporter off of a balcony after the State of the Union address. The congressman apologized to the reporter, who was threatened after asking about an investigation into Grimm’s campaign finances.

None of  the charges unsealed Monday were related to campaign finance, but Lynch said an investigation is ongoing. Authorities had been probing Grimm’s fundraising for the past two years.

Grimm is currently seeking reelection. He was charged shortly after the deadline for Republicans to put a different candidate up for his seat, but Lynch denied the indictment was politically motivated.

Follow Anna Sanders on Twitter @AnnaESanders



News
Entertainment
Sports
Lifestyle
Local

Mayor announces public housing improvements

Mayor Bill de Blasio spoke at the Lincoln Houses in East Harlem on Wednesday, calling for the scaffolding to come down at NYCHA complexes across…

National

Peter Theo Curtis: American released by Syrian militants…

An American writer freed this week from two years in the captivity of insurgents in Syria spoke briefly outside his family's Cambridge home Wednesday of…

Local

Bratton defends 'broken windows' work as NYPD support…

Sixty percent of those polled said they support the "broken windows" theory approach popularized by Commissioner Bratton since his first term in the 1990s.

Local

Transit changes for Labor Day weekend

The MTA is adding additional service Friday for New Yorkers getting out of the city for the long weekend. On Friday, Aug. 29, 27 additional…

Television

'Full House' might be relaunched with some of…

A new "Full House" might be in the works.

Movies

Review: 'The Congress' is a crazy, unwieldy sci-fi…

Robin Wright is the center of gravity in "The Congress," which turns from a live-action Hollywood satire into an animated spectacular on a downer future.

Movies

Review: 'The Last of Robin Hood' is a…

Dakota Fanning plays Errol Flynn's (Kevin Kline) teenage gal pal in "The Last of Robin Hood," which takes a scandal and makes it dully empathetic.

Movies

Review: The uneven 'Life of Crime' mostly gets…

Elmore Leonard's "The Switch" becomes the new indie crime dramedy "Life of Crime," with Jennifer Aniston as a kidnapped woman whose husband won't pay up.

NFL

Source: Stephen Hill 'faces a battle' to make…

A team source says Stephen Hill, who has battled injuries and poor performances during his first two years, is no lock to make the Jets’ final roster.

Sports

Serena Williams leaving legacy of talented American women…

It seems only a matter of when, not if, Serena Williams will win her 18th career grand slam championship.

College

When are 2014 college football playoffs? (Schedule, date,…

When and where are 2014 college football playoffs? A look at the schedule, date, TV, time for the semi-finals at championship game.

NFL

Dimitri Patterson suspended only for rest of preseason…

Dimitri Patterson ended up getting just a slap on the wrist.

Wellbeing

Heart trumps brain when it comes to movies…

When you need a good cry, do you reach for the movie that’s “based on a true story”? Science says you’re giving your brain far…

Sex

The 10 types of people you meet online

Does it ever seem like online dating profiles tend to get a little repetitive? It turns out you are not the only one to have…

Home

Labor Day essentials

Whether you’re soaking up the sun on the beach or barbecuing in the park here are some must-haves for your end-of-summer bash.

Education

Does the school day start too early?

As thousands of high schoolers get ready to head back to class, health experts say it may be time to push back the start of…