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Rep. Michael Grimm Pleads Guilty To Federal Tax Evasion Charge

NEW YORK (CBSNewYork/AP) -- Staten Island Rep. Michael Grimm has pleaded guilty to a federal tax evasion charge that he fought as he won re-election this fall.

Grimm entered the plea Tuesday in federal court in Brooklyn in a case stemming from an investigation of his campaign financing.

He pleaded guilty to one count of aiding in the filing of a false tax return. He'd been set to go to trial in February.

As CBS2's Dave Carlin reported, the congressman's public confession was a stunning turn around for a man who had spent years maintaining his innocence.

"I should not have done it and I'm truly sorry for it," Grimm said.

Rep. Michael Grimm Pleads Guilty To Federal Tax Evasion Charge

Sentencing is set for June 8. Prosecutors said between 24 and 30 months in prison would be appropriate; the defense estimated the appropriate sentence as 12 to 18 months.

According to an indictment, the tax fraud began in 2007 after Grimm retired from the FBI and began investing in a small Manhattan restaurant called Healthalicious.

The indictment accused him of underreporting more than $1 million in wages and receipts to evade payroll, income and sales taxes, partly by paying immigrant workers, some of them in the country illegally, in cash.

"Although it was a little restaurant, I made some very big mistakes; mistakes that I immensely, immensely regret," Grimm said.

The case stemmed from an investigation of Grimm's campaign financing. He was never charged with any offense related to his campaign, but a woman romantically linked to him pleaded guilty in September to lining up straw donors for his 2010 run.

The plea brings an end to the four-year investigation against him, but could also bring with it a prison sentence and possibly Grimm's resignation.

Rep. Michael Grimm Pleads Guilty To Federal Tax Evasion Charge

Asked outside court if he planned to resign his seat, Grimm said no. He added that he planned to "get back to work.''

"As of right now I'm still in a capacity to serve and that's exactly what I plan on doing," Grimm said.

Grimm made no excuses to the judge, but did offer reporters some explanations.

"I had delivery boys who were paid off the books and as a result the tax returns were not accurate," he said, "Everyone pays them off the books. It's very common, but it's wrong. I should not have done it."

The Democratic Congressional Campaign Committee said in a statement before his court appearance Tuesday that it was "past time for Michael Grimm to go,'' calling his continued presence in Congress "a disservice to the people of Staten Island and Brooklyn and a stain on the institution.''

The DCCC and House Minority Leader Nancy Pelosi, D-Calif., called on House Speaker John Boehner, R-Ohio, to ensure Grimm's departure.

Boehner has forced other lawmakers to resign for lesser offenses. He quickly orchestrated the 2011 resignation of Rep. Chris Lee, R-N.Y., a married lawmaker who responded to a personal ad by emailing a shirtless photograph of himself to another woman.

Boehner does not plan to comment on Grimm's situation until the two discuss it, Boehner spokesman Michael Steel said.

Asked at an October debate whether he would resign if found guilty, he responded, "Certainly, if I was not able to serve, then of course I would step aside and there would be a special election.''

But if he refuses to resign, it would take a rare vote by his fellow lawmakers to expel him from the House. The last member to be expelled was James Traficant, D-Ohio, who was kicked out of Congress in 2002.

Grimm won re-election in November while fighting the charges.

He made headlines in January after telling NY1 reporter Michael Scotto he wanted to throw the journalist off a balcony in the Capitol for asking about the campaign finance inquiry.

Grimm issued a statement soon afterward saying he has apologized to Scotto, which he said the reporter "was very gracious" and accepted his apology.

An independent advisory office recommended that the House Ethics Committee investigate the balcony incident. The ethics panel deferred its investigation into Grimm while the Justice Department case was ongoing.

But, now that he has confessed to a felony the big question is, how much longer will he stay in office?

"He doesn't deserve that position then, I feel, because he lied," Maria Parente said.

"It's mixed feelings I have now. I hope he doesn't step down because of all the god he's done for us," Jim Bavaso said.

If Grimm doesn't resign, the panel is sure to address the case next year.

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(TM and © Copyright 2014 CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2014 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)

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