Washington Township Man Sentenced to 49 Months’ Imprisonment for Tax Fraud Scheme and Theft from Elderly Victim

NEWARK N.J. - A Washington Township man was sentenced to 49 months' imprisonment for fraudulently seeking more than $1.4 million from the IRS by filing false tax returns claiming COVID-19-related employment tax credits, for laundering the proceeds from that scheme, and for stealing more than $180,000 from an elderly customer at the car dealership where he worked, Senior Counsel Philip Lamparello announced.

James J. Mastrogiovanni, 45, of Washington Township, pleaded guilty before U.S. District Judge William J. Martini in Newark federal court on May 20, 2025, to an information charging him with one count of conspiracy to defraud the United States, one count of mail fraud, one count of money laundering, and one count of access device fraud. U.S. District Judge William J. Martini imposed the sentence on December 4, 2025, in Newark federal court.

According to documents filed in this case and statements made in court:

During the pandemic, Mastrogiovanni engaged in a scheme with Leon Haynes, a tax preparer, to exploit COVID-19 relief programs to line his own pockets. From in or around March 2021 through in or around December 2022, Mastrogiovanni and Haynes prepared and filed with the IRS false and fraudulent Forms 941 on behalf of Mastrogiovanni, his family members, and others, claiming tax refunds intended to help struggling small businesses. All of the Forms 941 prepared in furtherance of the scheme were false and fraudulent because they listed employees and wages that, in fact, did not actually exist. Neither Mastrogiovanni nor any of his family members owned or operated a business, let alone had paid employees. Mastrogiovanni claimed at least $1,443,409 in tax credits, and as a result of the scheme, the U.S. Treasury disbursed at least $545,692 to Mastrogiovanni and his family members.

Haynes was found guilty by a jury on November 10, 2025 of 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 for 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 on behalf of himself and his clients. Haynes's sentencing is scheduled for March 12, 2026.

In addition to the tax fraud scheme, from on or about June 19, 2023 through on or about December 7, 2023, Mastrogiovanni engaged in a separate scheme to steal more than $180,000 from an 85-year old victim. The victim presented a check to Mastrogiovanni to purchase a vehicle at the car dealership where Mastrogiovanni worked. Mastrogiovanni later used the routing and checking account numbers on the check to make unauthorized personal transactions from the account until the account was empty.

In addition to the prison term, Judge Martini sentenced Mastrogiovanni to three years of supervised release following Mastrogiovanni's term of imprisonment and ordered restitution in the amount of $726,862.

Senior Counsel Lamparello credited special agents the IRS - Criminal Investigation, under the direction of Special Agent in Charge Jenifer L. Piovesan; special agents of the Social Security Administration, Office of the Inspector General, under the direction of Special Agent in Charge Amy Connelly; postal inspectors from the U.S. Postal Inspection Service, under the direction of Inspector in Charge Christopher Nielsen, Philadelphia Division; and officers of the Mahwah Police Department, under the direction of Chief Timothy O'Hara, with the investigation.

The government is represented by Assistant U.S. Attorneys Matthew Stark and Fatime Meka Cano of the Economic Crimes Unit in Newark.

The District of New Jersey COVID-19 Fraud Enforcement Strike Force is one of five strike forces established throughout the United States by the U.S. Department of Justice to investigate and prosecute COVID-19 fraud. The strike forces focus on large-scale, multi-state pandemic relief fraud perpetrated by criminal organizations and transnational actors. The strike forces are interagency law enforcement efforts, using prosecutor-led and data analyst-driven teams designed to identify and bring to justice those who stole pandemic relief funds.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice's National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

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Defense Counsel for Mastrogiovanni: Frank Agostino, Esq.