Representative Michael Grimm has pleaded not guilty to the federal charges.
A congressional campaign that already was promising to be tightly contested became even more contentious when incumbent Republican U.S. Rep. Michael Grimm was charged with evading taxes, news that voters in his Staten Island district met with mixed feelings.
Eddie Garcia, 70, said he voted for Grimm twice, and "I plan to vote for him again."
But others like Marc Patrick, 57, said he wouldn't even consider supporting a candidate with this kind of cloud hanging over him on Election Day. "This is supposed to be someone who respects the law, and that's certainly in question at this point," the retired teacher said.
Grimm was charged Monday following a two-year investigation that initially focused on alleged attempts to bypass contribution limits. He pleaded not guilty through his lawyer in federal court in Brooklyn to mail, wire and tax fraud charges in connection to a small Manhattan restaurant and was released on $400,000 bond secured by his Staten Island home.
The lawmaker, using a World War II memorial across the street from the courthouse as a backdrop, later accused prosecutors of leaking "all kinds of innuendos and accusations to support a political witch hunt" intended to "assassinate my character." He vowed to return to work in Congress while fighting the charges.
"I know I'm a moral man, a man of integrity," he added. "And I also know I have a lot more service and leadership to provide this country, and that's exactly what I intend to do."
But Grimm has even more of a challenge in running for re-election, Democratic strategist Phil Singer said.
The indictment is "going to chase him every time he goes out on the campaign trail," Singer said.
Republican strategist Hogan Gidley said, "Campaigns are difficult enough trying to stay on message and stay focused on your accomplishments without having to worry about federal indictments."
Democrats have been eyeing Grimm's seat. The Democrats' favored candidate, former New York City Councilman Domenic Recchia, has been hammering Grimm over his ethics and has impressed Washington Democrats.
Grimm stepped down Monday from the House Financial Services Committee. He told Republican House Speaker John Boehner he should be removed from the panel but said he plans to return once his legal issues are resolved. House Democratic leader Nancy Pelosi had sent a letter to Boehner saying Grimm should be removed, and a Boehner spokesman said the speaker believes the decision to step down was appropriate.
House members suspected of crimes sometimes win re-election, but an indictment typically leads to resignation or defeat at the polls.
FBI agents seized large amounts of cash when they raided the Washington home of Rep. William J. Jefferson, D-La., in May 2006, but voters re-elected him later that year. A federal grand jury indicted Jefferson on 16 corruption charges in June 2007, and he lost his 2008 bid for another term. He later was sentenced to prison.
Former House Majority Leader Tom DeLay, R-Texas, is one of the best-known lawmakers to face criminal charges. In 2005, a Texas grand jury indicted him on charges of trying to violate election laws. DeLay surrendered his leadership post but kept his House seat until June 2006. That's when he resigned, without seeking another term.
U.S. Attorney Loretta Lynch said investigators uncovered the restaurant fraud as they conducted the campaign finance probe. She denied the prosecution was politically motivated and suggested more charges were possible.
"We follow the evidence and see where it goes. ... The investigation is broader and ongoing," she said.
The 20-count indictment alleges the tax fraud began in 2007 after Grimm retired from the FBI and began investing in an Upper East Side eatery called Healthalicious. It accused him of trying to evade payroll, income and sales taxes by paying his workers, some in the country illegally, in cash.
Authorities say Grimm left the business in 2010, the year he won his first term in Congress. A House Ethics Committee announced in November that he was under investigation for possible campaign finance violations.
During the 2010 race, Grimm acknowledged receiving $250,000 to $300,000 in contributions from followers of an Israeli rabbi, Yoshiyahu Yosef Pinto. Some members of Pinto's congregation subsequently said they made tens of thousands of dollars in illegal contributions, including gifts passed through straw donors.
The Israeli businessman who had served as Grimm's liaison to Pinto's followers, Ofer Biton, pleaded guilty in August to an immigration fraud charge. Three days after that, the FBI filed a sealed criminal complaint accusing a Houston woman, Diana Durand, who had been romantically involved with Grimm, of using straw donors to make illegal campaign contributions.
Grimm, 44, made headlines in January after confronting a New York City cable news station reporter who tried to question him about the campaign finance inquiry.
After reporter Michael Scotto finished his report from a balcony in the Capitol, Grimm stormed back, leaned into him and said: "Let me be clear to you. If you ever do that to me again, I'll throw you off this (expletive) balcony."