In 1925, Remus was indicted for thousands of violations of the Volstead Act, convicted by a jury that made its decision in under two hours, and given a two year federal prison sentence. He spent two years in Atlanta Federal Penitentiary for bootlegging. While he was in prison, Remus befriended another inmate and told him his wife had control over his money. The inmate was an undercover prohibition agent Franklin Dodge. Dodge resigned his job and started an affair with Imogene. Dodge and Imogene liquidated Remus' assets and hid as much of the money as possible, in addition to attempting to deport Remus, and even hiring a hit man to murder Remus for $15,000. In addition, Remus's huge Fleischmann distillery was sold by Imogene, who gave her imprisoned husband only $100 of the multimillion-dollar empire he created.
Imogene divorced Remus in late 1927. On the way to court, on October 6, 1927, for the finalization of the divorce, Remus had his driver chase the cab carrying Imogene and her daughter through Eden Park in Cincinnati, finally forcing it off the road. Remus jumped out and fatally shot Imogene in the abdomen in front of the Spring House Gazebo to the horror of park onlookers.
The prosecutor in the case was 30-year-old Charles Phelps Taft II, son of United States Supreme Court Chief Justice and former President William Howard Taft and brother of the future Senator Robert Taft. Although he had lost his last big case, against another bootlegger, Charlie was seen as a man with a bright political future. The trial made national headlines for a month, as Remus defended himself on the murder charge. Remus pleaded temporary insanity. Partly because Remus was very popular in the city, the jury deliberated only 19 minutes before acquitting him by reason of insanity. The state of Ohio then tried to commit Remus to an insane asylum since the jury found him insane, but prosecutors were thwarted by their previous claim (backed up by the prosecution's three well-known psychiatrists) that he could be tried for murder because he was not insane.
Remus tried to get back into bootlegging after his six-month insanity sentence, but soon retired when he found that the market had been taken over by gangsters.