Million-dollar NJ Fraudster Pleads Guilty, Could Get Decades in Prison

A South Jersey man has pleaded guilty to fraudulently seeking over $1.4 million from the IRS by filing false tax returns that claimed COVID-related employment tax credits, laundering the proceeds from that scheme, and stealing more than $180,000 from an elderly customer at a car dealership.

Washington Township, NJ, Man Pleads Guilty

Federal authorities have announced that 44-year-old James J. Mastrogiovanni of Washington Township has pleaded guilty to the following charges:

• Conspiracy to defraud the United States
• Mail fraud
• Money laundering
• Access device fraud

COVID-related Tax Scheme

According to officials, Mastrogiovanni engaged in a scheme with Leon Haynes, a tax preparer, to exploit COVID-19 relief programs to line his own pockets.

From around March 2021 through December 2022, the pair prepared and filed with the IRS false and fraudulent forms on behalf of Mastrogiovanni, his family members, and others, claiming tax refunds that were intended to help struggling small businesses.

Neither Mastrogiovanni nor any of his family members owned or operated a business, let alone had paid employees, and those forms listed employees and wages that did not actually exist.

Mastrogiovanni claimed at least $1,443,409 in tax credits, and as a result, the U.S. Treasury disbursed at least $545,692 to him and his family members.

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$180K Stolen from 85-year-old Victim

Authorities also say that from around June through December 2023, Mastrogiovanni engaged in a separate scheme to steal more than $180,000 from an 85-year-old victim.

That victim gave a check to Mastrogiovanni to buy a vehicle at the car dealership where he worked. Mastrogiovanni then used the routing and account numbers to make unauthorized transactions until that account was empty.

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Big Prison Time Possible

• Conspiracy to defraud the United States carries a maximum penalty of five years in prison and a $250,000 fine
• Mail fraud carries up to 20 years in prison and a $250,000 fine
• Money laundering and access device fraud each carry up to a decade in prison and a $250,000 fine

Trial for Leon Haynes

Leon Haynes, as mentioned above, has been charged separately in a 63-count indictment for allegedly preparing and submitting more than 1,600 false employment tax returns on behalf of himself and clients totaling more than $150 million. His trial is set to begin in September.

The public is reminded that charges are accusations and all persons are considered innocent until proven guilty in a court of law.