That occurred even as Grimm Monday asked House Speaker John Boehner, R-Ohio, to "remove him" from the House Financial Committee as he works through his problems.

Grimm was indicted Monday on 20 counts of fraud related to federal charges of underreporting payroll while running an Upper East Side restaurant. The probe started on allegations of illegal fund-raising. The indictment was unsealed in Federal District Court in Brooklyn.

In his letter to the speaker, Grimm asked to be removed from the committee until the case is resolved. Boehner spokesman Michael Steel confirmed the speaker's receipt of the letter.

"The Speaker believes Rep. Grimm's decision is appropriate under the circumstances," he said.

Grimm is the primary sponsor of "the TRIA Reauthorization Act of 2013," H.R. 508. It would extend the program for 5 years. Another House bill would extend it for 10 years, but that is seen as unrealistic.

As for the private reaction in Congress to Grimm's indictment, one lobbyist said he has talked to several colleagues, "and all are agreed that there is zero impact of this indictment on TRIA."

The lobbyist said "There also is a considerable amount of goodwill toward Grimm for his doggedness on that issue and others like flood insurance reform."

The lobbyist added that, "Nobody's happy to see this. This town is all too willing to throw Members in legal trouble under the bus. But Grimm's response of malicious prosecution rings true to many of us, with a lot of things not adding up. 

"The politically expedient thing may be to try to force him out of office, but a lot of people in town think the guy deserves his day in court," the lobbyist said.

Meanwhile, the next step on TRIA is seen as action in the Senate Banking Committee within the next few weeks on S. 2244,  

The current authorization runs out Dec. 31. The bill, with Sen. Charles Schumer, D-N.Y., the lead sponsor, would extend the program for 7 years.

It would increase the amount of losses insurers must cover before federal aid steps in, from the current $27.5 billion by $2 billion annually, until it reaches $37.5 billion in five years. Another change is to reduce the total amount the federal government will cover from the current 85% to 80% over the same 5-year period.

Specifically, under the current law, the first $27.5 billion of insured losses are either covered by insurers or recouped by the government through a surcharge on commercial insurance policies. That would rise to $37.5 billion under the new bill, which was written by the staff of the Senate Banking panel.

There is opposition within the insurance industry to the Schumer bill, which has broad support amongst Schumer's colleagues. But P&C industry officials are unhappy with the bill because it would phase-in an increase in the deductible for insurers from a catastrophic attack by 33% for each insurer over time.

But, the increased "skin in the game" is believed necessary to get it through the much more conservative House.