Bay Ridge

Grimm resigns from House Financial Services Committee

While Recchia, suddenly favored in race, focuses on campaigning

April 29, 2014 By Paula Katinas Brooklyn Daily Eagle
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U.S. Rep. Michael Grimm, under indictment by the feds for tax evasion, mail fraud and other charges, has resigned from his post as a member of the House Financial Services Committee.

Grimm (R-C-Staten Island-Bay Ridge-Dyker Heights) announced his resignation from the committee Monday night, just hours after he appeared in federal court in Brooklyn and pleaded not guilty to the criminal charges against him. In a statement released by his office, Grimm said he was leaving the committee so that his legal troubles will not become a distraction to its members.

Meanwhile, Grimm’s Democratic opponent, former councilman Domenic Recchia, who is suddenly favored to win the November election, is out on the campaign trail, telling voters he is busy concentrating on the issues that matter to them.

“I’m going to continue my focus on ensuring that the people of Staten Island and South Brooklyn have a voice in congress fighting for their needs. That’s why I entered this race, and the news today has not changed that endeavor. I will continue to campaign hard and speak with voters about how I am going to fight for the middle class by creating jobs, offering better transportation options, and improving our schools,” Recchia said in a statement released by his campaign on April 25, the day the news broke that Grimm was going to be indicted.

On Sunday, the day before the indictment against Grimm was unsealed, Recchia was spotted at the Taste of the Ridge charity event at Saint Patrick Church in Bay Ridge, laughing and joking with local residents.

Grimm vowed to continue doing his job as a congressman and said he plans to return to the committee once his legal situation is resolved.

“I am proud of my committee accomplishments as my tenure has resulted in meaningful legislation that aids my district and millions of people across the country who are now threatened by severe weather on one hand and the inability to access affordable flood insurance on the other,” Grimm stated.

He was referring to the Homeowner Flood Insurance Affordability Act, a bill which he sponsored to help victims of Hurricane Sandy. The legislation was signed into law by President Barack Obama on March 1.

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“It is unfortunate that trumped-up charges filed against me have necessitated this action but this was an appropriate decision that ensures the committee’s legislative agenda is not distracted,” Grimm stated. “I look forward to resuming my work on the committee once a jury of my peers has weighed the evidence and I am fully exonerated.” 

On Monday, a 20-count indictment was unsealed in federal court in Brooklyn charging Grimm with five counts of mail fraud, five counts of wire fraud, three counts of aiding and assisting in the preparation of false federal tax returns, one count of conspiring to defraud the United States, one count of impeding the Internal Revenue Service, one count of health care fraud, one count of engaging in a pattern or practice of hiring and continuing to employ unauthorized aliens, two counts of perjury and one count of obstructing an official proceeding.

The charges, which grew out of a federal investigation into Grimm’s campaign finance operation from his 2010 campaign, deal with the congressman’s ownership of a health food restaurant in Manhattan. Grimm allegedly evaded taxes by concealing more than $1 million in sales and wages while running the restaurant, Healthalicious, between 2007 and 2010, prior to his first term in office. Grimm paid his workers, many of them undocumented immigrants, in cash to evade paying payroll, income, and sales taxes, according to the indictment.

And Grimm may find himself in more hot water. CNN reported that the investigation into his campaign finance operation is continuing. In January, the FBI arrested a Grimm fundraiser. She is charged with illegally funneling more than $10,000 into his campaign.

Grimm, a two-term lawmaker representing the 11th Congressional District (Staten Island-parts of southwest Brooklyn) is running for re-election in November. Republican and Conservative Party leaders have said publicly that they’re sticking with him. But privately, several GOP sources told the Brooklyn Eagle that they’re worried the Grimm mess will turn voters off and hand the victory to Recchia. “If enough Republicans stay home on Election Day, we’re in trouble,” one Brooklyn Republican Party official said.

Prior to the indictment, political analysts had given a slight edge to Grimm in the race. But on Monday, the Cook Political Report, a highly respected website that handicaps races across the country, posted an article describing the race as “lean Democratic,” giving the edge to Recchia.

Still, Grimm has his defenders. Former staffer Christine Sisto, who is now an editorial assistant at National Review, wrote an article defending her old boss and describing his dogged efforts to help Sandy victims after the storm. “Grimm’s constituents feel he represents them well in Washington. Indeed, Grimm’s flood insurance bill, H.R. 3370, truly helped Superstorm Sandy victims whose flood insurance rates skyrocketed after the storm,” Sisto wrote.



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