Leon Haynes Tax Preparation (Unnamed)
Outcome
Leon Haynes of Teaneck, New Jersey was convicted by jury in November 2025 of filing more than 1,600 false tax returns claiming over $170 million in fraudulent COVID-19 employment tax credits from November 2020 through May 2023, with the IRS disbursing approximately $40 million in fraudulent refunds — the largest individual ERC fraud case prosecuted as of the trial date.
Details
Leon Haynes — $170 Million ERC/COVID Tax Credit Fraud, Teaneck, New Jersey (2025)
Outcome: Leon Haynes of Teaneck, New Jersey, a tax return preparer, was convicted by federal jury in November 2025 of aiding and assisting in the preparation of false tax returns, mail fraud, and tax evasion for filing more than 1,600 false employment tax returns from November 2020 through May 2023 that claimed over $170 million in fraudulent COVID-19 pandemic employment tax credits — with the IRS disbursing approximately $40 million in fraudulent refunds before the scheme was discovered.
Leon Haynes operated as a tax return preparer in Teaneck, New Jersey (Bergen County). From November 2020 through May 2023, Haynes repeatedly exploited COVID-19 pandemic relief programs by preparing and filing more than 1,600 false IRS employment tax returns on behalf of himself and his clients, falsely claiming COVID-19-related employment tax credits including the Employee Retention Credit and paid sick and family leave credits. The scheme escalated over time: an initial indictment referenced $124 million in false claims, which was later expanded to $170 million as investigators documented additional filings.
The IRS disbursed at least $40 million in fraudulent tax refunds to Haynes' clients based on the false returns before the scheme was detected. Haynes charged preparation fees from the refund checks, directly profiting from each fraudulent disbursement. In addition to the false return preparation charges, Haynes was convicted of mail fraud (for using the postal system to transmit fraudulent materials) and two counts of tax evasion for his own personal tax obligations.
The November 2025 conviction followed a jury trial in the District of New Jersey. Haynes was convicted on 15 counts of aiding and assisting in the preparation and presentation of false returns, one count of mail fraud, and two counts of tax evasion. Sentencing was scheduled for March 12, 2026, with each false return count carrying up to three years in prison, mail fraud up to 20 years, and each tax evasion count up to five years.
Primary Source: IRS Criminal Investigation — New Jersey Tax Preparer Convicted for $170 Million COVID-19 Tax Credit Scheme
How Crucible Prevents This
Crucible's instinct-observer hook would detect the statistical anomaly of 1,600+ pandemic tax credit filings by a single preparer without corresponding payroll documentation. The pre-tool-check hook would require documented employee records, payroll tax filings, and qualified leave documentation before any pandemic ERC or sick leave credit could be claimed. The quality-gate would flag any preparer whose ERC claim volume exceeded statistical norms for their stated client base size and industry mix.
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