Teaneck Tax Preparer Gets 12 Years for one of the Largest Pandemic Tax Frauds in U.S. History

NJ Tax Preparer Sentenced to 12 Years for Massive $170M COVID-19 Fraud

the staff of the Ridgewood blog

Teaneck, N.J. — In the largest case of its kind to date, a Teaneck tax preparer has been sentenced to 144 months (12 years) in federal prison for orchestrating a staggering $170 million COVID-19 tax credit scheme.

Leon Haynes, 52, was also ordered by U.S. District Judge William J. Martini to pay more than $55 million in restitution to the Internal Revenue Service (IRS). The sentencing follows a landmark trial that exposed how Haynes turned emergency pandemic relief programs into a “personal cash machine.”

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The Anatomy of a $170 Million Scam

As the world grappled with the economic fallout of the pandemic, Congress authorized the Employee Retention Tax Credit (ERTC) and sick/family leave credits to keep small businesses afloat. Haynes, a professional tax preparer, saw these lifelines as an opportunity for unprecedented theft.

According to federal prosecutors and evidence presented at his November 2025 trial, Haynes’ scheme involved:

• 1,900+ Fraudulent Returns: Between 2020 and 2023, Haynes submitted thousands of false employment tax returns to the IRS.

• Fabricated Data: The forms claimed fictitious employees and entirely made-up wages for himself and his clients.

• The “Pay-to-Play” Model: Haynes charged his clients a percentage of the fraudulent refunds and demanded payments in cash to avoid leaving a paper trail.

• Double Dipping: While stealing from the government, Haynes also committed tax evasion by failing to report the millions in fees he pocketed from his co-conspirators.

The Largest Case of Its Kind

U.S. Attorney Robert Frazer emphasized that this case represents a betrayal of the public trust. While the scheme sought $170 million, the government successfully intercepted much of it, though over $55 million was still paid out before the fraud was halted.

“Pandemic relief programs were created to support Americans during a national crisis, but Haynes treated those programs as a personal cash machine,” said U.S. Attorney Rob Frazer. “Our office will continue to pursue those who exploit emergency relief programs.”

The COVID-19 Fraud Strike Force

The investigation was a multi-agency effort involving:

• IRS-Criminal Investigation

• Social Security Administration OIG

• U.S. Postal Inspection Service

This prosecution is a major victory for the COVID-19 Fraud Enforcement Strike Force, one of five elite teams established by the Department of Justice to hunt down large-scale criminal organizations and individuals who stole pandemic funds.

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Do you suspect tax fraud or the misuse of pandemic funds? The Department of Justice encourages anyone with information to contact the National Center for Disaster Fraud Hotline at 866-720-5721.