Millions in COVID fraud — Teaneck, NJ, tax preparer charged
💸 Teaneck, NJ, tax preparer charged with COVID fraud
😮 Leon Haynes could get 20-years in federal prison, if convicted
💰 Federal watchdog reports more than $200 billion in COVID relief was wasted on fraud
A tax preparer from Teaneck faces over 20-years in federal prison if he is convicted of filing hundreds of bogus tax returns to claim COVID relief money.
U.S. Attorney for New Jersey Philip Sellinger claims Leon Haynes, 49, of Teaneck, prepared 1,387 false forms that were submitted to the IRS claiming $124.8 million in COVID related tax credits.
Sellinger says Haynes told his clients they were eligible for the money solely because they had a business. He's accused of doctoring the forms by grossly overstating the number of employees and wages.
The businesses were not consulted prior to Haynes submitting the false forms.
Haynes is also accused of submitting false claims on behalf of three business that he personally owns.
"While our country was fighting the spread of the virus and its profound economic impact, Haynes allegedly scammed the system in a massive scheme to line his own pockets,” Sellinger said in a statement.
Haynes clients did not know about the fraud
In some cases, Haynes clients were able to greatly reduce the amount of tax they owed the IRS. In other cases, the businesses received cash payments or tax refunds they were not entitled to.
According to court documents, Haynes charged each client up to a 15% fee based on the tax refunds the client received many clients paid him those fees in cash.
Sellinger says Haynes personally received over $1 million in tax refund checks for his businesses.
"As many of us suffered through the pandemic, Leon Haynes found a way to line his pockets at our expense,” Christopher Nielsen, Postal Inspector in Charge of the Philadelphia Division, said. "We have begun the process of holding him accountable for his frauds."
According to the U.S. Attorney's Office, each count of aiding and assisting in the preparation of false returns carries a maximum penalty of three years in prison and a $250,000 fine. The mail fraud charge carries a maximum penalty of 20 years in prison and a $250,000 fine or twice the gross gain to the defendant or gross loss to the victim, whichever is greatest.
Haynes was arrested on Monday.
COVID fraud was rampant
In June, the U.S. Small Business Administration released a report from the Office of Inspector General finding at least 17% of the $1.2 trillion in relief funds distributed by the SBA were wasted in fraud.
The federal watchdog report put the losses at over $200 billion.
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