NJ Tax Preparer Convicted for $170M COVID Tax Credit Scheme
A New Jersey tax preparer has been found guilty of his scheme seeking more than $170 million in fraudulent tax refunds from the IRS by causing more than 1,900 false tax returns to be filed claiming COVID-19-related employment tax credits.
Last week, following a six-day jury trial, 52-year-old Leon Haynes of Teaneck was convicted on 15 counts of aiding and assisting in the preparation and presentation of false tax returns, one count of mail fraud, and two counts of tax evasion.
Federal authorities say from November 2020 to May 2023, Haynes orchestrated a massive, multi-million dollar scam to exploit COVID-related tax credits for his own greed.
Prosecutors Say 1,900+ False Returns Were Filed
As a tax preparer, Haynes prepared and submitted, and worked with others to prepare and submit, more than 1,900 false employment tax returns to the IRS claiming COVID-related tax credits on behalf of himself and his clients. Each of these tax forms contained a number of false statements. For example, the vast majority of the tax forms claimed a fictitious number of employees and/or fabricated wages.
Haynes and his co-conspirators fraudulently sought more than $170 million in tax refunds on behalf of his own businesses and his clients, and successfully caused the government to pay out over $55 million in refunds.
Throughout the scheme, Haynes also charged clients a percentage of the refund checks as his fee and requested cash payments. He failed to report the money he received from his clients, thereby evading his own taxes.
Charges Carry Potential Decades in Prison
Each count of aiding and assisting in the preparation of false returns carries a maximum of three years in prison and a $250,000 fine, mail fraud carries a maximum penalty of 20 years behind bars and a $250,000 fine, and each tax evasion count carries up to five years and a $250,000 fine.
Sentencing is scheduled for March 12th.
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