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Feds Accuse Rep. Michael Grimm Of Wire Fraud, Tax Evasion
By
Jen Chung
Published Apr 28, 2014
Modified Apr 28, 2014
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By
Jen Chung
Published Apr 28, 2014
Modified Apr 28, 2014
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Justice Department officials have hit Rep. Michael Grimm with a slew of charges, including wire fraud, mail fraud and tax fraud. FBI Assistant Director George Venizelos was unsparing in his statement: "As a former FBI agent, Rep. Grimm should understand the motto: fidelity, bravery, and integrity. Yet he broke our credo at nearly every turn. In this 20-count indictment, Rep. Grimm lived by a new motto: fraud, perjury, and obstruction."
While the FBI had been investigating donations to Grimm, a Republican, from the mystic rabbi Yosef Pinto, the indictment relates to Grimm's pre-Congressional years Upper East Side restaurant, Healthalicious—and Grimm's alleged attempt to avoid paying taxes on wages. According to the State Island Advance:
In total, he's accused of concealing more than $1 million in Healthalicious gross receipts and hundreds of thousands of dollars of employees' wages.
From 2007 to 2010, Grimm paid workers -- many of whom were allegedly undocumented immigrants -- in cash and did not report those wages to federal and state authorities, according to the indictment. By under-reporting the true amount of payroll to the New York State Insurance Fund, Grimm received lower monthly workers' compensation premiums, the indictment alleges.
Additionally, by under-reporting the amount of gross receipts the restaurant earned, he dramatically lowered the taxes the restaurant owed to both the state and federal government, the indictment alleges.
U.S. Attorney Loretta Lynch said, "He deliberately planned to systematically lie to every taxing authority to whom his business had an obligation to report... Michael Grimm never met a tax he didn't like to evade."
Grimm is up for re-election, and some Republicans have suggested the indictment is politically motivated, especially since it might be too late for the GOP to suggest a different Republican candidate. However, Politico reports that Lynch "rejected claims of playing politics by indicting Grimm after the filing deadline closed for his race. Grimm is now almost certain to be on the ballot in November, giving Democrats a pick-up opportunity on a seat they’ve long targeted. 'When you investigate a case like this, we follow the evidence,' Lynch said. 'It’s just as irresponsible to bring it before it’s ready.'"
Tagged
fraud
healthalicious
mail fraud
michael grimm
perjury
Rep. Michael Grimm
tax evasion
Jen Chung
Jen Chung is a former WNYC and Gothamist editor.
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Gothamist is funded by sponsors and member donations
Gothamist is funded by sponsors and member donations
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