Indictment — United States v. Leon Haynes, District of New Jersey (Document 16)

Summary

An indictment of Leon Haynes, a tax preparer, in the U.S. District Court for the District of New Jersey, Case 2:24-cr-00232-WJM, filed April 3, 2024 as Document 16. It charges false tax returns under 26 U.S.C. § 7206(2), mail fraud under 18 U.S.C. § 1341, aggravated identity theft under 18 U.S.C. § 1028A and tax evasion under 26 U.S.C. § 7201. The grand jury alleges that from November 2020 through May 2023 Haynes filed at least 1,600 false Forms 941 claiming COVID-Related Tax Credits totaling approximately $151,000,000, and that the U.S. Treasury disbursed at least $40,000,000 in refunds to him and his clients. It describes the employee retention credit and sick and family leave credits and tables quarterly refund claims for clients called Individual-1, Individual-2 and Individual-3. It ends with a forfeiture allegation.

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Case 2:24-cr-00232-WJM Document16- Filed 04/03/24 Page 1 of 41 PagelD: 40

UNITED STATES DISTRICT COURT _ ,, AT we, y>
DISTRICT OF NEW JERSEY iLERK, US DSTAET aE: DISTRICT COURT- DNJ

UNITED STATES OF AMERICA : Hon. (MEF)
V. : Crim. No. 24-232
LEON HAYNES ‘ Counts 1-55

26 U.S.C. § 7206(2)
(False Tax Returns)

Count 56-59
18 U.S.C. § 1341
(Mail Fraud)

Count 60

18 U.S.C. § 1028A

18 U.S.C. § 2

(Aggravated Identity Theft)

Count 61
18 U.S.C. § 1341
(Mail Fraud)

Counts 62-63

26 U.S.C. § 7201
(Tax Evasion)

INDICTMENT

1. The Grand Jury in and for the District of New Jersey, sitting at
Newark charges as follows:

Introduction

mber 2020 through in or around May 2023,

4

2. From in or around Nov
Defendant Leon Haynes (“HAYNES”), a tax preparer, executed a scheme to defraud

the United States of more than $150,000,000 by preparing and filing more than
Case 2:24-cr-00232-WJM Document16 - Filed 04/03/24 Page 2 of 41 PagelD: 41

* 1,600 quarterly employment tax returns for himself and his clients that falsely
claimed he and his clients were entitled to receive tax refunds based on
fraudulently claimed COVID-related tax credits.

General Allegations

= At all times relevant to this Indictment:

A. The Internal Revenue Service (“IRS”) was an agency of the
United States Department of the Treasury responsible for administering the tax
laws of the United States and collecting taxes owed to the United States, including
income and employment taxes.

B. Federal law required employers to collect, truthfully account for,
and pay over to the United States, certain payroll taxes, including their employees’
withheld federal income taxes, Social Security and Medicare taxes, and the
employer’s matching portion of the Social Security and Medicare taxes. A
responsible person at a business was required to file quarterly an Employer's
Quarterly Federal Tax Return, Form 941 (“Form 941”), reporting certain
information and assessing payroll taxes for the business. On the Form 941, the
responsible person was required to supply the IRS with information about the
number of employees the business had and the wages paid by the business during
that quarter, among other information.

C. An E-File Declaration for Employment Tax returns, Form 8453-

; EMP (‘Form 8453-EMP"), was a form at to authenticate an —— ;

employment tax return, authorize an electronic return originator or an intermediate
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service provider to transmit an electronic employment tax return via a third party,
and authorize an electronic funds withdrawal for payment of federal taxes owed.
The Form 8453-EMP was required to be signed by an authorized individual of the
taxpayer business who, in so doing, swore under penalty of perjury that the tax
return was true, correct, and complete and consented to the electronic return
originator or intermediate service provider submitting the employment tax return
to the IRS.

D. A Wage and Tax Statement, Form W-2 (“Form W-2”), reported
wages paid by an employer to an employee and taxes withheld from those wages. It
was issued by U.S. employers to employees and filed by employers with the Social
Security Administration (“SSA”).

E. IRS Form 1040, U.S. Individual Income Tax Return, is used by
U.S. taxpayers to file an annual income tax return.

COVID-Related Tax Credits

4, The Coronavirus Aid, Relief, and Economic Security Act or CARES Act,
enacted on March 27, 2020, provided for an employee retention credit (“ERC”),
designed to encourage businesses to retain employees on their payroll during the
COVID-19 pandemic. The Taxpayer Certainty and Disaster Tax Relief Act of 2020
and the American Rescue Plan Act modified and extended the ERC.

5. For calendar year 2020, the ERC was a refundable tax credit against
certain employment _s equal to 50 sce BE up to $10,000 of qhalifiad wages an

eligible employer paid to each employee from March 13, 2020 through December 31,
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2020. For calendar year 2021, the ERC was a refundable tax credit against certain
employment taxes equal to 70 percent of up to $10,000 of qualified wages an eligible
employer paid to each employee during each quarter. Thus, the ERC was capped at
$5,000 per employee for calendar year 2020 and $7,000 per employee per quarter for
calendar year 2021. |

6. Generally, businesses and tax-exempt organizations that qualified for
the ERC were those that: (a) were shut down during 2020 or the first three calendar
quarters of 2021 by government order due to the COVID-19 pandemic;

(b) experienced a specified decline in gross receipts during the eligibility periods
during 2020 or the first three calendar quarters of 2021; or (c) qualified as a
recovery startup business for the third or fourth quarters of 2021.

7. The Families First Coronavirus Response Act provided for eligible
employers to receive refundable tax credits for wages paid to employees while on
sick leave to recover from any injury, disability, illness, or condition resulting from
COVID-19 or wages paid to employees while on family leave to care for a family
member who was injured, disabled, ill, or otherwise suffering from a condition due
to COVID-19. Together these credits are called the Sick and Family Leave Wage
Credit (““SFLC’).

8. Employers were entitled to receive a dollar-for-dollar credit for
qualified wages paid to an employee, plus allocable health plan expenses and the
aelovets share of Medicare taxes, while that Sriclnte was on sick ishve resulting

from COVID-19. This credit was limited to up to ten days of sick leave per
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employee for the period ending March 31, 2021. That resulted in a maximum credit
$5,110 per employee for that period. The American Rescue Plan Act (“ARPA”)
provided an identical credit for the period April 1, 2021 through September 30, 2021
with an identical maximum of $5,110 in credits per employee.

9. Employers were entitled to receive a credit of up to two-thirds of the
qualified wages paid to an employee while that employee was on family leave to
care for a family member suffering from a condition resulting from COVID-19, plus
allocable health plan expenses and the employer's share of Medicare taxes. For the
period ending March 31, 2021, this credit was limited to up to $200 per day for up to
ten weeks, resulting in a maximum eligible credit of $10,000 per employee. The
ARPA provided an identical credit for the period April 1, 2021 through September
30, 2021 and extended the length of family leave to twelve weeks, thereby raising
the maximum eligible credit for that period to $12,000 per employee.

10. Together, the ERC and SFLC are referred to herein as COVID-Related
Tax Credits.

11. COVID-Related Tax Credits were claimed by an employer by filing a
Form 941 or an Adjusted Employer’s Quarterly Federal Tax Return or Claim for
Refund, Form 941X, with the IRS for the relevant quarter.

12. The same'wages could not be used as both qualified sick leave wages
and qualified family leave wages.

ID. ' Employers were not eligible to receive both the ERC and SFLC with

respect to the same wages.
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Leon Haynes

14. HAYNES resided in Teaneck and Bogota, New Jersey, and he provided
clients tax preparation services.
15. HAYNES purported to own and operate the following businesses, each
purportedly located in New Jersey:
A. Leons Tax Services, a tax preparation company;
B. GHP Payroll and Business Services (“GHP”), a supposed payroll
services business;
C. CNL Rentals, a car rental business; and
i, A restaurant called Lyla Mediterranean 2 Go.

COVID-Related Tax Credit Scheme

16. From at least as early as in or around November 2020 through in or
around May 2023, HAYNES facilitated a scheme to fraudulently obtain COVID-
Related Tax Credits from the U.S. Treasury by preparing and filing with the IRS at
least 1,600 false and fraudulent Forms 941, including false and fraudulent Forms
941 filed on behalf of his own businesses, claiming tax refunds based on COVID-
Related Tax Credits totaling approximately $151,000,000. As a result of the
scheme, the U.S. Treasury disbursed at least $40,000,000 in tax refunds to
HAYNES and his clients.

17. HAYNES and his clients were not entitled to the amount of COVID-'
Related Tax Credits or resulting refunds claimed on the Forms 941 HAYNES

prepared and filed.
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18. Many of the Forms 941 HAYNES prepared were false and fraudulent
because they listed employees and wages that, in fact, did not actually exist.
HAYNES used these fake employees and wages to claim COVID-Related Tax
Credits and, in so doing, fraudulently caused the U.S. Treasury to issue tax refunds.

19. Furthermore, nearly all the Forms 941 HAYNES prepared were false
in that they sought more funds than the programs allowed. For example, nearly
every Form 941 HAYNES prepared either:

A. claimed an ERC above the maximum allowed based on the
number of employees and wages reported;

B. claimed an SFLC in excess of the amount of wages reported;
G, listed the same wages as both qualified sick leave wages and
qualified family leave wages; and/or

D. claimed an SFLC and ERC for the same wages.

20. HAYNES generally told his clients that the U.S. Government was
providing COVID-19 relief to people with small businesses and falsely represented
that his clients were entitled to receive the tax refunds they ultimately received
from the U.S. Treasury as a result of HAYNES’ preparation of false and fraudulent
tax returns.

21.’ HAYNES profited from the scheme by either (a) receiving tax refunds
based on false Forms 941 he submitted for one of his own purported companies, or

, (b) by collecting a fee from clients, typically in cash, that HAYNES generally
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calculated as a percentage of any client’s fraudulently obtained tax refund from
HAYNES’ false Form 941 scheme.

22. Inor around 2023, after learning he was under criminal investigation
for preparing false Forms 941, HAYNES prepared and filed false Forms 941,
including at least three false returns that he prepared and filed after speaking
directly to law enforcement about the investigation in February 2023.

Individual-1

23. Individual-1, a taxpayer who resided in New Jersey, used HAYNES for
tax preparation services. Individual-1 owned and operated a cosmetics business
(“Business A”).

24. Inor around 2021, HAYNES approached Individual-1 about
Individual-1’s eligibility to receive money from the U.S. Government for COVID-
relief despite HAYNES knowing that Business A did not have employees or operate
a payroll.

25. Based on HAYNES’ representations, Individual-1 told HAYNES to
complete the necessary forms to receive the COVID-relief funds to which HAYNES
said Individual-1 was entitled.

26. Onor about the following dates, for the following quarters, HAYNES
prepared and filed and caused to be filed with the IRS false Forms 941 on behalf of
Individual-1 for Business A claiming COVID-Related Tax Credits. These Forms
odarwan false in that élidy reported Business A had employees, paid wages to

employees, and paid sick and family leave wages, among other false items:
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Approx. Date Tax Period Refund
Form 941 was Requested
Received by IRS

2/23/2021 2020 Q2 $52,412.50
2/23/2021 2020 Q3 $49,744.42
2/23/2021 2020 Q4 $50,385.00
6/11/2021 2021 Q1 $52,209.42
7/31/2021 2021 Q2 $106,789.08
10/31/2021 2021 Q3 $196,837.36
6/12/2022 2021 Q4 $103,516.41
6/12/2022 2022 Q1 $97,071.67

27. HAYNES affixed and caused to be affixed Individual-1’s signature on
Forms 8453-EMP associated with the false Forms 941.

28. Despite preparing the Forms 941 and being paid to do so, HAYNES did
not list himself as the tax preparer on the Forms 941 he prepared and filed for
Business A.

29. The U.S. Treasury paid Individual-1 tax refunds totaling
approximately $693,493 as a result of the fraudulent COVID-Related Tax Credits
claimed on the false Forms 941 that HAYNES prepared and filed.

30. At HAYNES’ request, Individual-1 paid HAYNES approximately
$10,000 in cash for preparing the false Forms 941.

Individual-2

31. Individual-2, a taxpayer who resided in New Jersey, used HAYNES for
tax preparation services. Individual-2 had a business (‘ ‘Business B”), but the
business did not have any employees.

32. HAYNES told Individual-2, in substance, that (a) during the pandemic,
the government was giving money to small businesses to keep them afloat, and

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(b) HAYNES would fill out a form to get Individual-2 this money for small
businesses. Individual-2 agreed based on HAYNES’ representations.

33. Onor about the following dates, for the following quarters, HAYNES
prepared and filed and caused to be filed with the IRS false Forms 941 on behalf of
Individual-2 for Business B claiming COVID-Related Tax Credits. These returns
were false in that they reported Business B had employees, paid wages to

employees, and paid sick and family leave wages, among other false items:

Approx. Date Tax Period Refund
Form 941 was Requested
Received by IRS

8/2/2021 2020 Q2 $62,327
8/2/2021 2020 Q3 $72,193
9/14/2021 2020 Q4 $87,544
9/14/2021 2021 Q1 $98,114
9/14/2021 2021 Q2 $122,532
10/8/2021 2021 Q3 $165,042
2/1/2022 2021 Q4 $161,915

Unbeknownst to Individual-2, HAYNES affixed and caused to be

affixed Individual-2’s signature on oe 8453-EMP associated with the false
Forms 941.

35. The U.S. Treasury paid Individual-2 approximately $599,651 asa
result of the fraudulent COVID-Related Tax Credits claimed on the false Forms 941
HAYNES prepared and filed.

36. At HAYNES’ request, Individual-2 paid HAYNES approximately 10%

of the fraudulently obtained funds.

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Individual-3

37. Individual-3, a taxpayer who resided in New Jersey, used HAYNES for
tax preparation services. Individual-3 owned and operated a business in the food
service industry (“Business C”).

38. Inor around 2021, HAYNES told Individual-3, in substance, that there
was a program for businesses to receive COVID-19 relief money from the
government. However, HAYNES did not tell Individual-3 that businesses were
required to pay employees wages to be eligible for the money. Based on HAYNES’
representations and omissions, Individual-3 authorized HAYNES to apply for
COVID-19 relief for Business C.

39. Onor about the following dates, for the following quarters, HAYNES
prepared and filed and caused to be filed with the IRS false Forms 941 on behalf of
Individual-3 for Business C claiming COVID-Related Tax Credits. These returns
were false in that they overstated wages paid to employees and reported employees

had been paid sick and family leave wages, when they had not, among other false

items:
Approx. Date Tax Period Refund
Form 941 was Requested
Received by IRS
8/22/2021 : 2020 Q2 . $81,276
| 10/8/2021 © 2020 Q3 $89,827
12/11/2021 2020 Q4 $86,073
. 12/11/2021 2021 Q1 $95,073
12/11/2021 2021 Q2 $136,814 °
12/12/2021 2021 Q3 $162,021
2/10/2022 2021 Q4 $160,344

1]
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40. Unbeknownst to Individual-3, HAYNES affixed and caused to be
affixed Individual-3’s signature on Forms 8453-EMP associated with the false
Forms 941.

41. The U.S. Treasury paid Individual-3 approximately $637,236 as a
result of the fraudulent COVID-Related Tax Credits claimed on the false Forms 941
HAYNES prepared and filed.

42. HAYNES asked Individual-3 to pay him approximately 20% of the tax
refund checks Individual-3 received. In turn, Individual-3 paid HAYNES
approximately $210,000, mostly in cash.

43. HAYNES also prepared Individual Income Tax Returns for Individual-
3 for tax years 2020 and 2021.

44. Inor around March 2022, HAYNES told Individual-3 that he had
prepared Individual-3’s 2021 Individual Income Tax Return and that Individual-3
owed the IRS approximately $30,000 in taxes. HAYNES told Individual-3 that
rather than pay the IRS directly, Individual-3 should give HAYNES the money in
cash and HAYNES would provide it to the IRS. Individual-3 provided HAYNES
with approximately $30,000 in cash in increments to pay the IRS for Individual-3’s
purported tax debt.

45. ' HAYNES did not file Individual-3’s 2021 Individual Income Tax

Return nor did he pay the IRS any money on Individual-3’s behalf.

'
4

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Individual-4

46. Individual-4, a taxpayer who resided in New Jersey, used HAYNES to
prepare his Individual Income Tax Returns since approximately 2015. Individual-4
owned and operated a construction business (“Business D”).

47. Inor around late 2020 or early 2021, HAYNES told Individual-4, in
substance, that Individual-4 was eligible to receive money from the U.S.
Government for COVID-19 relief because Individual-4 had a business. HAYNES
knew that Business D did not have employees or operate a payroll, but he did not
tell Individual-4 that only businesses that paid wages to employees were eligible for
the COVID-19 relief. Based on HAYNES’ representations and omissions,
Individual-4 authorized HAYNES to apply for COVID-19 relief for Business D.

48. Onor about the following dates, for the following quarters, HAYNES
prepared and filed and caused to be filed with the IRS false Forms 941 on behalf of
Individual-4 for Business D claiming COVID-Related Tax Credits. These returns
were false in that they reported Business D had employees, paid wages to

employees, and paid sick and family leave wages, among other false items:

Approx. Date Tax Period Refund
Form 941 was Requested
Received by IRS

1/8/2021 2020 Q2 $25,557 |
1/8/2021 2020 Q3 $2,498 ©
1/8/2021 2020 Q4 | $24,941
7/2/2021° 2021 Q2 ’ | $96,256
11/19/2021 2021 Q3 $174,839
2/6/2022 2021 Q4 $136,884

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49. Unbeknownst to Individual-4, HAYNES affixed and caused to be
affixed Individual-4’s signature on Forms 8453-EMP associated with the false
Forms 941.

50. The U.S. Treasury paid Individual-4 approximately $527,487 as a
result of the fraudulent COVID-Related Tax Credits claimed on the false Forms 941
HAYNES prepared and filed.

51. At HAYNES’ request, Individual-4 paid HAYNES approximately
$35,000 in cash from the fraudulently obtained tax refund checks.

52. Despite preparing the Forms 941, and subsequently being paid to do
so, HAYNES did not list himself as the tax preparer on the false Forms 941 he
prepared and filed for Individual-4.

53. At some point after Individual-4 received some of the fraudulently
obtained tax refund checks, HAYNES asked Individual-4 to provide him with the
names and social security numbers of Business D’s employees. HAYNES told
Individual-4 that this information would facilitate additional requests for COVID-
19 relief funds. In response, Individual-4 told HAYNES that his business did not
have any employees.

Individual-5

54. Individual-5, a taxpayer who resided in New Jersey, began using
HAYNES’ tax preparation services for his Individual Income Tax Returns in or
around 2018. Individual-5 owned and operated an HVAC and heating business

(“Business E”).

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55. At HAYNES’ request, in the course of preparing Individual-5’s
Individual Income Tax Returns for 2018 and 2019, Individual-5 provided HAYNES
with information about Individual 5’s income, Business E’s gross receipts and
expenses, and his personal identifying information, including Individual-5’s social
security number, credit card number, home address, email address, telephone
number, EIN for Business E, and other information. Individual-5 told HAYNES
that Business E did not have any employees.

56. Unbeknownst to Individual-5 and without Individual-5’s authorization,
on or about the following dates, for the following quarters, HAYNES used, without
Individual-5’s consent or authorization, Individual-5’s personal identifying
information to prepare and file and cause to be filed false Forms 941 with the IRS
on behalf of Individual-5 for Business E claiming COVID-Related Tax Credits.
These returns were false in that they reported Business E had employees, paid

wages to employees, and paid sick and family leave wages, among other false items:

Approx. Date Tax Period Refund
Form 941 was Requested
Received by IRS

3/26/2021 2020 Q2 $41,448
3/26/2021 2020 Q3 $40,283
3/26/2021 2020 Q4 $40,495
4/29/2021 2021 QI $51,761

57. Unbeknownst to Individual-5 and without Individual-5’s authorization,
HAYNES affixed and caused to be,affixed Individual-5’s signature on Forms 8453-

EMP associated with the false Forms 941.

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58. Despite preparing the Forms 941, HAYNES did not list himself as the
tax preparer on the false Forms 941 he prepared without Individual-5’s knowledge.

59. Asaresult of the false Forms 941 HAYNES prepared and filed, in or
around late April 2021, Individual-5 received three tax refund checks from the U.S.
Treasury totaling approximately $119,137.

60. When Individual-5 subsequently called HAYNES to express concern
about the legality of receiving these checks, HAYNES responded by asking
Indvidual-5 to pay him approximately $10,000 for each check Individual-5 received.
And after Individual-5 indicated that he was going to contact the IRS and return
the money, HAYNES became agitated and told Individual-5, in substance, not to
contact the IRS and not to return the money.

61. Onor about May 5, 2021, HAYNES sent Individual-5’s spouse a text
message, which stated, in part:

“My friends, I have nothing at all to fear with what I’m doing, but don’t

send those checks back to them; and if you already deposited them, just

leave it and let god do his work, but if you didn’t deposit it yet, just take

a lighter to it leave it at that and then I will amend everything and

reverse it like it never happened, but I’m at a loss for words, but no

matter what, I still love you guys forever and no hard feelings, just don’t

stir up unnecessary shit by sending checks back is all [. . . .]”

62. HAYNES never amended the Forms 941 he prepared and filed on

behalf of Individual-5 for Business E.

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Individual-6

63. Inor around 2020, Individual-6, a taxpayer who resided in New
Jersey, wanted to start a trucking business (“Business F”). Business F never
actually operated.

64. Individual-6 spoke with HAYNES about possible funds or grants
Individual-6 could access to launch Business F. HAYNES requested, and
Individual-6 provided, Individual-6’s background information, including Business
F’s name and other personal identifying information. HAYNES and Individual-6
did not discuss Forms 941 or the ERC. After that conversation, Individual-6 and
HAYNES did not speak again.

65. Unbeknownst to Individual-6 and without Individual-6’s authorization,
on or about the following dates, for the following quarters, HAYNES prepared and
filed and caused to be filed with the IRS false Forms 941 on behalf of Individual-6
for Business F claiming COVID-Related Tax Credits. The returns were false in that
they reported Business F had employees, paid wages to employees, and paid sick

and family leave wages, among other false items:

Approx. Date Tax Period Refund
Form 941 was Requested
Received by IRS

4/23/2021 _ | 2020 Q2 $31,866
4/23/2021 * | 2020 Q3 $37,833
4/23/2021 2020 Q4 : $25,948

66. Unbeknownst to Individual-6, HAYNES affixed and caused to be
affixed Indvidual-6’s signature on Forms 8453-EMP associated with the false Forms

941.
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67. Despite preparing the Forms 941, HAYNES did not list himself as the
tax preparer on the false Forms 941 he prepared without Individual-6’s knowledge.

68. Individual-6 did not receive any tax refund checks as a result of the
false Forms 941 HAYNES prepared and filed.

Individual-7

69. Individual-7, a taxpayer who resided in New Jersey, used HAYNES to
prepare his Individual Income Tax Returns beginning in approximately 2020.
Individual-7 owned and operated a garbage removal business (“Business G”).

70. Inor around December 2020, HAYNES told Individual-7, in substance,
that Individual-7 qualified for the ERC because he had a business with employees.

71. HAYNES prepared and reviewed Business G’s 2020 Q2 & Q3 Forms
941 with Individual-7. HAYNES also prepared Forms 941 for Business G for 2020
Q4 through 2021 Q2.

72. The number of employees and wages reported on each of the Forms
941 HAYNES prepared and caused to be filed for Business G were accurate.
However, on or about the following dates, for the following returns, HAYNES
prepared and filed and caused to be filed with the IRS false Forms 941 on behalf of
Individual-7 for Business G claiming COVID-related tax credits. The returns were
false in that they reported Business G had paid sick and family leave wages when it
had not, and double-counted qualified sick leave and qualified family leave wages,

among other false items:

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Approx. Date Tax Period Refund
Form 941 was Requested
Received by IRS

12/22/2020 2020 Q2 $21,998
12/22/2020 2020 Q3 $21,995
6/8/2021 2020 Q4 $48, 102
6/8/2021 2021 Q1 $52,464
1/17/2023 2021 Q2 $105,452

73. At HAYNES’ request, Individual-7 signed Forms 8453-EMP associated
with each of the Forms 941 that HAYNES prepared and filed.

74. Despite preparing the Forms 941, and being paid to do so, HAYNES
did not list himself as the tax preparer on the Forms 941 he prepared and filed on
behalf of Individual-7.

75. Individual-7 received a tax refund check of approximately $22,078 asa
result of the false Forms 941 HAYNES prepared and filed.

76. Individual-7 paid HAYNES approximately $1,500 in cash from the
fraudulently obtained tax refund check.

Individual-8

77. Individual-8, a taxpayer who resided in New Jersey, used HAYNES to
prepare Individual-8’s Individual Income Tax Returns. Individual-8 owned and
operated a landscaping business (“Business H”).

78. During the COVID-19 pandemic, HAYNES told Individual-8, in
substance, that Individual-8 could get money from the government through the

ERC by filing a Form 941 because Individual-8 had a business that paid employees.

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79. Onor about the following dates, for the following returns, HAYNES
prepared and filed and caused to be filed with the IRS false Forms 941 on behalf of
Individual-8 for Business H claiming COVID-related tax credits. The returns were
false in that they overstated wages paid to employees and reported that Business H

paid sick and family leave wages to employees when it had not, among other false

items:
Approx. Date Tax Period Refund
Form 941 was Requested
Received by IRS
4/19/2021 2020 Q2 $52,085
4/19/2021 2020 Q3 $53,043
4/19/2021 2020 Q4 $55,372
4/29/2021 2021 Q1 $49,442
5/10/2022 2021 Q2 $93,201
5/10/2022 2021 Q3 $94,891
5/10/2022 2021 Q4 $182,110

80. Unbeknownst to Individual-8, HAYNES affixed and caused to be
affixed Individual-8’s signature on Forms 8453-EMP associated with the false
Forms 941.

81. Despite preparing the Forms 941, HAYNES did not list himself as the
tax preparer on the Forms 941 he prepared and filed on behalf of Individual-8.

82. Individual-8 did not receive any tax refund checks as a result of the

false Forms 941 HAYNES prepared and filed. -

20
Case 2:24-cr-00232-WJM Document16- Filed 04/03/24 Page 21 of 41 PagelD: 60

Individual-9

83. Individual-9, a taxpayer who resided in New Jersey, used HAYNES to
prepare Individual-9’s Individual Income Tax Returns. Individual-9 owned and
operated a skin care retail business (“Business J”).

84. Inor around 2021, HAYNES told Individual-9, in substance, that
Individual-9 qualified to receive a tax refund for small businesses as a result of the
COVID-19 pandemic. HAYNES did not provide Individual-9 with any further
details about the refund program, Business J’s eligibility, or the Form 941 filing
requirements. Based on HAYNES’ representations and omissions, Individual-9 told
HAYNES to try to obtain the tax refund for Business J on Individual-9’s behalf.

85. Onor about the following dates, for the following returns, HAYNES

prepared and filed and caused to be filed with the IRS false Forms 941 on behalf of
Individual-9 for Business J claiming COVID-Related Tax Credits. The returns were
false in that they overstated the number of employees, overstated the wages paid to
employees, and reported that Business J paid sick and family leave wages to

employees when it had not, among other false items:

Approx. Date Tax Period Refund
Form 941 was Requested
Received by IRS

1/30/2021 2020 Q2 $36,692
1/30/2021 2020 Q3 $34,671
1/30/2021 2020 Q4 $34,671
6/4/2021 2021 Q1 $52,370
7/16/2021 2021 Q2 $90,377
10/8/2021 2021 Q3 $172,529
1/26/2022 2021 Q4 $178,005
12/21/2022 2022 Q1 $93,380
Case 2:24-cr-00232-WJM Document16 - Filed 04/03/24 Page 22 of 41 PagelD: 61

12/21/2022 2022 Q2 $87,363
12/21/2022 2022 Q3 $96,420
4/17/2023 2022 Q4 $90,834

86. Unbeknownst to Individual-9, HAYNES affixed and caused to be
affixed Individual-9’s signature on Forms 8453-EMP associated with the false
Forms 941.

87. Individual-9 received six tax refund checks, totaling more than
$400,000, as a result of the false Forms 941 HAYNES prepared and filed.

88. At HAYNES’ request, Individual-9 paid HAYNES approximately 10%
of the fraudulently obtained refund money.

89. Despite preparing the Forms 941, and being paid to do so, HAYNES
did not list himself as the tax preparer on the Forms 941 he prepared and filed for
Individual-9. |

90. HAYNES also prepared Individual-9’s Individual Income Tax Returns
for 2020 and 2021. On the 2020 Individual Income Tax Return, HAYNES prepared
a Schedule C for Business J that overstated the business’ gross receipts and
deductible expenses and reported that Business J paid no wages despite preparing
Forms 941 that reported Business J had paid wages.

91. HAYNES did not report Business J on Individual-9’s 2021 Individual
Income Tax Return despite preparing and filing four Forms 941 for Business. J for

tax year 2021.

22
Case 2:24-cr-00232-WJM Document16- Filed 04/03/24 Page 23 of 41 PagelD: 62

HAYNES’ Tax Evasion

92. From 2021 through 2022, HAYNES received more than $1.8 million
from clients for whom he submitted false Forms 941.

93. Onor about June 8, 2022, HAYNES filed a false U.S. Individual
Income Tax Return for himself for 2021 that failed to report all of the income he
received from clients for preparing false Forms 941.

94. Onor about July 7, 2023, HAYNES filed a false U.S. Individual Income
Tax Return for himself for 2022 that failed to report all of the income he received
from clients for preparing false Forms 941.

False 941s for HAYNES’ Businesses

95. From at least 2020 through 2022, HAYNES purported to own and
operate Leons Tax Services, GHP Payroll, CNL Rentals, and Lyla Mediterranean 2
Go.

96. Onor about February 27, 2023, HAYNES voluntarily spoke to law
enforcement about its ongoing investigation into his tax preparation activities.
During that meeting, HAYNES stated, in substance, that his businesses only hired
contractors, not employees, and did not pay them for time they did not work.

97. Onor about the following dates, for the following quarters, HAYNES
prepared and filed and caused to be filed with the IRS false Forms 941 on behalf of
his businesses falsely claiming COVID-Related Tax Credits. The returns were false

in that they reported that the businesses paid wages to employees and paid

23
Case 2:24-cr-00232-WJM Document16- Filed 04/03/24 Page 24 of 41 PagelD: 63

employees sick and family leave wages when, in fact, they had not, among other

false items:

Business Tax Period | Approx. Date Form Refund
941 was Received by Requested
IRS
Leons Tax Service Q2 2020 11/8/2020 $77,753
Leons Tax Service Q3 2020 11/8/2020 $62,651
Leons Tax Service Q4 2020 12/24/2020 $104,852
CNL Q2 2020 2/15/2021 $73,186
CNL Q3 2020 2/15/2021 $57,538
CNL Q4 2020 2/15/2021 $68,866
Leons Tax Service Q1 2021 4/1/2021 $203,866
CNL Q1 2021 5/29/2021 $117,271
Leons Tax Service Q2 2021 7/11/2021 $258,280
CNL Rentals Q2 2021 7/12/2021 $184,113
GHP Q2 2020 7/12/2021 $58,212
GHP Q3 2020 7/12/2021 $42,320
GHP Q4 2020 7/12/2021 $42,748
GHP. Q1 2021 7/12/2021 $59,018
GHP Q2 2021 7/18/2021 $62,858
Lyla Mediterranean Q2 2021 7/17/2021 $107,938
Lyla Mediterranean Q1 2021 7/23/2021 $74,414
Lyla Mediterranean Q4 2020 8/16/2021 $44,787
CNL Q3 2021 9/27/2021 200,729
Leons Tax Service Q3 2021 9/30/2021 $243,071
Lyla Mediterranean Q3 2021 9/30/2021 $203,947
GHP Q3 2021 10/23/2021 $210,535
CNL Q4 2021 1/3/2022 $215,954
GHP Q4 2021 1/3/2022 $195,140
Leons Tax Service Q4 2021 1/3/2022 $281,378
Lyla Mediterranean Q4 2021 1/3/2022 $269,669
GHP Q1 2022 6/7/2022 $114,614
CNL Q1 2022 6/8/2022 ‘| $181,559
Leons Tax Service Q1 2022 6/8/2022 $175,246 .
Lyla Mediterranean Q1 2022 6/8/2022 $211,349
GHP Payroll Q2 2022 7/6/2022 * $175,204
Leons Tax Service Q2 2022 7/6/2022 $274,309
Lyla Mediterranean Q2 2022 7/7/2022 $175,388

24
Case 2:24-cr-00232-WJM Document16- Filed 04/03/24 Page 25 of 41 PagelD: 64

98. By filing false tax returns fraudulently claiming COVID-related Tax
Credits, HAYNES caused the U.S. Treasury to mail him the following tax refund

checks, which totaled approximately $1,428,592:

Tax Business Approx. Location Location Amount of
Period Date U.S. Check Check Check
Treasury Mailed From | Mailed To | Issued
Check Issued

2020 Q2 | Leons Tax 12/22/2020 Kansas City, | Bogota, $78,838.96
Services Missouri New Jersey

2020 Q3 | Leons Tax | 12/17/2020 Kansas City, | Bogota, $63,736.96
Services Missouri New Jersey

2020 Q4 | Leons Tax | 2/23/2021 Kansas City, | Bogota, $35,362.88
Services Missouri New Jersey

2021 Q1 | Leons Tax | 5/252021 Kansas City, | Bogota, $199,209.50
Services Missouri New Jersey

2021 Q2 | Leons Tax | 8/24/2021 Kansas City, | Bogota, $254,117.36
Services Missouri New Jersey

2022 Q3 | Leons Tax | 11/22/2022 Kansas City, | Bogota, $160,230.18
Services Missouri New Jersey

2020 Q2 | CNL 3/23/2021 Kansas City, | Teaneck, $71,417.00
Rentals Missouri New Jersey

2020 Q3 | CNL 3/30/2021 Kansas City, | Teaneck, $56,056.71
Rentals Missouri New Jersey

2020 Q4 | CNL 8/10/2021 Kansas City, | Bogota, $68,014.16
Rentals Missouri New Jersey

2021 Q2 | CNL 8/24/2021 Kansas City, | Bogota, $181,213.08
Rentals Missouri New Jersey

2021 Q4 | CNL 2/22/2022 Kansas City, | Bogota, $195,967.52
Rentals Missouri New Jersey

99. Onor about the following dates, the SSA sent letters to HAYNES

regarding the businesses listed below. In each letter, the SSA informed HAYNES
that the wage information he reported on the Forms 941 filed with the IRS did not
match the wages that were reported to the SSA on forms W-2 and requested that he

fill out a questionnaire: U (

25
Case 2:24-cr-00232-WJM Document16- Filed 04/03/24 Page 26 of 41 PagelD: 65

Date Tax Period Entity

July 1, 2022 2020 Leons Tax Services
July 1, 2022 2020 CNL Rentals

Feb. 25, 2022 2020 CNL Rentals

Dec. 28, 2022 2020 CNL Rentals

Jan. 20, 2023 2020 Leons Tax Services
Feb. 10, 2023 2020 CNL Rentals

Feb. 24, 2023 2021 CNL Rentals

100. After HAYNES received the two July 1, 2022 letters referenced above,
he returned two questionnaires to the SSA. On each questionnaire HAYNES wrote:

I am the owners [sic] and operator of said business listed
on this form. I certify that the compensation that was
reported to Social Security is attributed to the Employee
Retention Credit and Family and Sick leave. Furthermore,
the compensation that was reported is inaccurate.

26
Case 2:24-cr-00232-WJM Document16- Filed 04/03/24 Page 27 of 41 PagelD: 66

COUNTS 1-55
(Aiding and Assisting in the Preparation of False Returns)

101. The allegations in paragraphs 1 through 100 of this Indictment are
realleged here.

102. Onor about the dates set forth below, in the District of New Jersey,
and elsewhere, the defendant,

LEON HAYNES,

did willfully aid and assist in, procure, counsel, and advise in the preparation and
presentation to the Internal Revenue Service of Employer’s Quarterly Federal Tax
Returns, Forms 941, for the periods stated below, which were false and fraudulent
as to one or more material matters, and which HAYNES did not believe to be true
and correct as to every material matter in that each return falsely asserted that the
business reported on the return was entitled to receive more COVID-Related Tax
Credits than it was actually entitled to receive, among other false items, each

constituting a separate count of this Indictment.

Count Individual Tax Period | Approx. Form 941
Associated Date False Items
with Business Received
by IRS

1 Individual-1 2020 Q2 2/23/2021 | i. Line 1, number of employees;
ii. Line 2, wages, tips, and other
compensation;
iil. Line: 18e, Total deposits,
deferrals, and refundable credits.
iv. Line 15, Overpayment

2 Individual-1 2020 Q3 2/23/2021 |i. Line 1, number of employees;
\ : u | ii. Line 2, wages, tips, and other
compensation;
ili. Line 18e, Total deposits,
deferrals, and refundable credits.
iv. Line 15, Overpayment

27
Case 2:24-cr-00232-WJM Document16- Filed 04/03/24 Page 28 of 41 PagelD: 67

3 Individual-1 2020 Q4 2/23/2021 | i. Line 1, number of employees;

ii. Line 2, wages, tips, and other

compensation;

iii. Line 13e, Total deposits,

deferrals, and refundable credits.

iv. Line 15, Overpayment

4 Individual-1 2021 Q1 6/12/2021 |i. Line 1, number of employees;

ii. Line 2, wages, tips, and other

compensation;

iii. Line 18e, Total deposits,

deferrals, and refundable credits.

iv. Line 15, Overpayment

5 Individual-1 2021 Q2 7/20/2021 | i. Line 1, number of employees;

i. Line 2, wages, tips, and other

compensation;

iii. Line 13g, Total deposits and

refundable credits.

iv. Line 15, Overpayment

6 Individual-1 2021 Q3 10/06/2021 | i. Line 1, number of employees;

ii. Line 2, wages, tips, and other

compensation;

iii. Line 18g, Total deposits and

refundable credits.

iv. Line 15, Overpayment

7 Individual-1 2021 Q4 6/12/2022 |i. Line 1, number of employees;

ii. Line 2, wages, tips, and other

compensation;

ili. Line 18g, Total deposits and

refundable credits.

iv. Line 15, Overpayment

8 Individual-1 2022 Q1 6/12/2022 | i. Line 1, number of employees;

li. Line 2, wages, tips, and other

compensation;

iii. Line 13g, Total deposits and

refundable credits.

iv. Line 15, Overpayment

9 Individual-2 2020 Q2 8/2/2021 i. Line 1, number of employees;

li. Line 2, wages, tips, and other

compensation;

iii. Line 13e, Total deposits,

deferrals, and refundable credits.
iv. Line 15, Overpayment

10 | Individual-2 2020 Q3 8/2/2021 i. Line 1, number of employees;

4 ii. Line 2, wages, tips, and other

compensation;

iii. Line 18e, Total deposits,

deferrals, and refundable credits.

iv. Line 15, Overpayment

28
Case 2:24-cr-00232-WJM Document 16

Filed 04/03/24

11

Individual-2

2020 Q4

9/14/2021

i. Line 1, number of employees;
ii. Line 2, wages, tips, and other
compensation;

iii. Line 18e, Total deposits,
deferrals, and refundable credits.
iv. Line 15, Overpayment

12

Individual-2

2021 Q1

9/14/2021

i. Line 1, number of employees;
ii. Line 2, wages, tips, and other
compensation;

iii. Line 13e, Total deposits,
deferrals, and refundable credits.
iv. Line 15, Overpayment

13

Individual-2

2021 Q2

9/14/2021

i. Line 1, number of employees;

ii. Line 2, wages, tips, and other
compensation;

ii. Line 138g, Total deposits and
refundable credits.

iv. Line 15, Overpayment

14

Individual-2

2021 Q3

10/8/2021

i. Line 1, number of employees;

ii. Line 2, wages, tips, and other
compensation;

ii. Line 13g, Total deposits and
refundable credits.

iv. Line 15, Overpayment

15

Individual-2

2021 Q4

2/1/2022

i. Line 1, number of employees;

ii. Line 2, wages, tips, and other
compensation;

iii. Line 13g, Total deposits and
refundable credits.

iv. Line 15, Overpayment

16

Individual-3

2020 Q2

8/22/2021

i. Line 1, number of employees;
ii. Line 2, wages, tips, and other
compensation;

iii. Line 18e, Total deposits,
deferrals, and refundable credits.
iv. Line 15, Overpayment

17

Individual-3

t

2020 Q3

10/8/2021

i. Line 1, number of employees;
1i. Line 2, wages, tips} and other
compensation;

iii. Line 13e, Total deposits,
deferrals, and refundable credits.
iv. Line 15, Overpayment

18

Individual-3

2020 Q4.

12/11/2021

i. Line 1, number of employees;
ii. Lihe 2, wages, tips, and other
compensation;

iii. Line 13e, Total deposits,
deferrals, and refundable credits.
iv. Line 15, Overpayment

29

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19

Individual-3

2021 Q1

12/11/2021

i. Line 1, number of employees;
il. Line 2, wages, tips, and other
compensation;

ii. Line 18e, Total deposits,
deferrals, and refundable credits.
iv. Line 15, Overpayment

20

Individual-3

2021 Q2

12/11/2021

i. Line 1, number of employees;

11. Line 2, wages, tips, and other
compensation;

ui. Line 18g, Total deposits and
refundable credits.

iv. Line 15, Overpayment

21

Individual-3

2021 Q3

12/12/2021

i. Line 1, number of employees;

u. Line 2, wages, tips, and other
compensation;

iii. Line 18g, Total deposits and
refundable credits.

iv. Line 15, Overpayment

22

Individual-3

2021 Q4

2/10/2022

i. Line 1, number of employees;

ii. Line 2, wages, tips, and other
compensation;

iii. Line 13g, Total deposits and
refundable credits.

iv. Line 15, Overpayment

23

Tndividual-4

2020 Q2

1/8/2021

i. Line 1, number of employees;
ui. Line 2, wages, tips, and other
compensation;

ili. Line 18e, Total deposits,
deferrals, and refundable credits.
iv. Line 15, Overpayment

24

Individual-4

2020 Q3

1/8/2021

i. Line 1, number of employees;
u. Line 2, wages, tips, and other
compensation;

ii. Line 18e, Total deposits,
deferrals, and refundable credits.
iv. Line 15, Overpayment

25

Individual-4

2020 Q4

1/8/2021

i. Line 1, number of employees;
ii. Line 2, wages, tips, and other
compensation;

iii. Line 13e, Total deposits,
deferrals, and refundable credits.
iv. Line 15,'Overpayment

26

Individual-4

2021 QI

i. Line 1, number of employees; |
ii. Line 2, wages, tips, and other '
compensation;

ui. Line 18e, Total deposits,
deferrals, and refundable credits.
iv. Line 15, Overpayment

30

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Page 31 of 41 PagelD:

27

Individual-4

2021 Q2

7/2/2021

i. Line 1, number of employees;

ii. Line 2, wages, tips, and other
compensation;

iii. Line 13g, Total deposits and
refundable credits.

iv. Line 15, Overpayment

28

Individual-4

2021 Q3

11/9/2021

i. Line 1, number of employees;

ii. Line 2, wages, tips, and other
compensation;

iii. Line 13g, Total deposits and
refundable credits.

iv. Line 15, Overpayment

29

Individual-4

2021 Q4

2/6/2022

i. Line 1, number of employees;

ii. Line 2, wages, tips, and other
compensation;

i. Line 13g, Total deposits and
refundable credits.

iv. Line 15, Overpayment

30

Individual-6

2020 Q2

4/23/2021

i. Line 1, number of employees;
11. Line 2, wages, tips, and other
compensation;

iii. Line 13e, Total deposits,
deferrals, and refundable credits.
iv. Line 15, Overpayment

31

Individual-6

2020 Q3

4/23/2021

i. Line 1, number of employees;
li. Line 2, wages, tips, and other
compensation;

iii. Line 138e, Total deposits,
deferrals, and refundable credits.
iv. Line 15, Overpayment

32

Individual-6

2020 Q4

i. Line 1, number of employees;
ii. Line 2, wages, tips, and other
compensation;

iii. Line 13e, Total deposits,
deferrals, and refundable credits.
iv. Line 15, Overpayment

33

Individual-7

2020 Q2

12/22/2020

i. Line 18e, Total deposits, deferrals,
and refundable credits.
li. Line 15, Overpayment

34

Individual-7

2020 Q3

12/22/2020

i. Line 13e, Total deposits, deferrals,
and refundable credits.
ul. Line 15, Overpayment

35

Individual-7,

2020 Q4

6/8/2021

i. Line 18e, Total deposits, deferrals,
and refundable credits.
ii. Line 15, Overpayment

36

Individual-7

2021 Q1

6/8/2021

i. Line 18e, Total deposits, deferrals,
and refundable credits.
ii. Line 15, Overpayment

31

70
Case 2:24-cr-00232-WJM Document16 - Filed 04/03/24 Page 32 of 41 PagelD: 71

37 Individual-7 2021 Q2 1/17/2023 |i. Line 13g, Total deposits and
refundable credits.
ii. Line 15, Overpayment
38 Individual-8 2020 Q2 4/19/2021 |i. Line 2, wages, tips, and other
compensation;
ii. 13e, Total deposits, deferrals, and
refundable credits.
Line 15, Overpayment
39 Individual-8 2020 Q3 4/19/2021 |i. Line 1, number of employees;
ii. Line 2, wages, tips, and other
compensation;
iii. Line 18e, Total deposits,
deferrals, and refundable credits.
iv. Line 15, Overpayment
40 Individual-8 2020 Q4 4/19/2021 |i. Line 1, number of employees;
ii. Line 2, wages, tips, and other
compensation;
iii. Line 18e, Total deposits,
deferrals, and refundable credits.
iv. Line 15, Overpayment
41 Individual-8 2021 Q1 4/29/2021 | 1. Line 2, wages, tips, and other
compensation;
li. 18e, Total deposits, deferrals, and
_| refundable credits.
Line 15, Overpayment
42 Individual-8 2021 Q2 5/10/2022 | i. Line 2, wages, tips, and other
compensation;
ii. Line 18g, Total deposits and
refundable credits.
iii. Line 15, Overpayment
43 Individual-8 2021 Q3 5/10/2022 |i. Line 2, wages, tips, and other
compensation;
ii. Line 18g, Total deposits and
refundable credits.
iii, Line 15, Overpayment
44 Individual-8 2021 Q4 5/10/2022 | i. Line 2, wages, tips, and other
compensation;
ii. Line 18g, Total deposits and
refundable credits.

iii. Line 15, Overpayment
45 Individual-9 2020 Q2 1/30/2021 |i. Line 1, number of employees;

uu. Line 2, wages, tips, and other

iii. Line 18e, Total deposits,
deferrals, and refundable credits.
iv. Line 15, Overpayment

32
Case 2:24-cr-00232-WJM Document 16

Filed 04/03/24

46

Individual-9

2020 Q3

1/30/2021

i. Line 1, number of employees;
ii. Line 2, wages, tips, and other
compensation;

ii. Line 13e, Total deposits,
deferrals, and refundable credits.
iv. Line 15, Overpayment

47

Individual-9

2020 Q4

1/30/2021

i. Line 1, number of employees;
ii. Line 2, wages, tips, and other
compensation;

iii, Line 18e, Total deposits,
deferrals, and refundable credits.
iv. Line 15, Overpayment

48

Individual-9

2021 Q1

6/4/2021

i. Line 1, number of employees;
ii. Line 2, wages, tips, and other
compensation;

iii. Line 18e, Total deposits,
deferrals, and refundable credits.
iv. Line 15, Overpayment

49

Individual-9

2021 Q2

7/16/2021

i. Line 1, number of employees;

ui. Line 2, wages, tips, and other
compensation;

iii. Line 13g, Total deposits and
refundable credits.

iv. Line 15, Overpayment

50

Individual-9

2021 Q3

10/8/2021

i. Line 1, number of employees;

ii. Line 2, wages, tips, and other
compensation;

ii. Line 18g, Total deposits and
refundable credits.

iv. Line 15, Overpayment

51

Individual-9

2021 Q4

1/26/2022

i. Line 1, number of employees;

ii. Line 2, wages, tips, and other
compensation;

ui. Line 18g, Total deposits and
refundable credits.

iv. Line 15, Overpayment

52

Individual-9

2022 Q1

12/21/2022

i. Line 1, number of employees;

u. Line 2, wages, tips, and other
compensation;

iii. Line 13g, Total deposits and
refundable credits.

| Individual-9

12/21/2022

i, Line 1, number of employees;

ii. Line 2, wages, tips, and other
compensation;

ii. Line 18g, Total deposits and
refundable credits.

iv. Line 15, Overpayment

Page 33 of 41 PagelD: 72
Case 2:24-cr-00232-WJM Document16- Filed 04/03/24 Page 34 of 41 PagelD: 73

54 Individual-9 2022 Q3 12/21/2022 | i. Line 1, number of employees;

11. Line 2, wages, tips, and other
compensation;

iii. Line 13g, Total deposits and
refundable credits.

iv. Line 15, Overpayment

55 Individual-9 2022 Q4 4/17/2023 |i. Line 1, number of employees;

ii. Line 2, wages, tips, and other
compensation;

iii. Line 13g, Total deposits and
refundable credits.

iv. Line 15, Overpayment

‘

In violation of Title 26, United States Code, Section 7206(2).

34
Case 2:24-cr-00232-WJM Document16 Filed 04/03/24 Page 35 of 41 PagelD: 74

COUNTS 56-59
(Mail Fraud)

103. The allegations in paragraphs 1 through 100 of this Indictment are
realleged here.

104. From as early as in or around April 2021 through in or around June
2021, in the District of New Jersey, and elsewhere, the defendant,

LEON HAYNES,

knowingly and intentionally devised and intended to devise a scheme and artifice to
defraud the Internal Revenue Service and to obtain money and property by means
of materially false and fraudulent pretenses, representations, and promises,
including by filing false Forms 941 claiming COVID-Related Tax Credits for
Business E, and, for the purpose of executing and attempting to execute such
scheme and artifice, did knowingly transmit and cause to be transmitted by means
of the mails in interstate and foreign commerce, the following mailings, each

constituting a separate count of this Indictment:

Count | Tax Period | Approx. Location Location Amount of
Date U.S. Check Mailed | Check Mailed | Check
Treasury From To Issued
Check Issued
56 2020 Q2 4/27/2021 Kansas City, Newark, New | $40,438.03
Missouri Jersey
57 2020 Q3 4/27/2021 Kansas City, Newark, New | $39,246.30
58 2020 Q4 4/27/2021 Kansas City, Newark, New | $39,452.53
Missouri Jersey
59 2021 Q1 6/1/2021 Kansas City, Newark, New | $50,608.90
U | Missouri Jersey i

In violation of Title 18, United States Code, Section 1341.
Case 2:24-cr-00232-WJM Document16- Filed 04/03/24 Page 36 of 41 PagelD: 75

COUNT 60
(Aggravated Identity Theft)

105. The allegations in paragraphs 1 through 100 of this Indictment are
realleged here.

106. Onor about March 26, 2021, in the District of New Jersey, and
elsewhere, the defendant,

LEON HAYNES,

did knowingly transfer, possess, and use, without lawful authority, a means of
identification of another person, namely Individual-5, during and in relation to a
felony violation enumerated in Title 18, United States Code, Section 1028A(c)(5),
that is, mail fraud, in violation of Title 18, United States Code, Section 1341, as
charged in Count 56 of this Indictment, knowing that the means of identification

belonged to another actual person.

In violation of Title 18, United States Code, Section 1028A and Section 2.

36
Case 2:24-cr-00232-WJM Document16- Filed 04/03/24 Page 37 of 41 PagelD: 76

COUNT 61
(Mail Fraud)

107. The allegations in paragraphs 1 through 100 of this Indictment are
realleged and incorporated here.

108. From in or around November 2020, through in or around January
2028, in the District of New Jersey, and elsewhere, the defendant,

LEON HAYNES,

knowingly and intentionally devised and intended to devise a scheme and artifice to
defraud the Internal Revenue Service and to obtain money and property by means
of materially false and fraudulent pretenses, representations, and promises,
including by filing false Employer’s Quarterly Federal Tax Returns, Forms 941,
claiming COVID-Related Tax Credits for HAYNES’ purported companies and, for
the purpose of executing and attempting to execute such scheme and artifice, did
knowingly transmit and cause to be transmitted by means of the mails in interstate

and foreign commerce, the following mailing:

Tax Business Approx. Location Location Amount of
Period Date U.S. Check Check Check
Treasury Mailed From | Mailed To Issued
Check Issued
2021 Q2 | Leons Tax | 8/24/2021 Kansas City, | Bogota, $254,117.36
Services Missouri New Jersey

In violation of Title 18, United States Code, Section. 1341.

ST
Case 2:24-cr-00232-WJM Document16 - Filed 04/03/24 Page 38 of 41 PagelD: 77

COUNTS 62-63
(Tax Evasion)

109. The allegations in paragraphs 1 through 100 of this Indictment are
realleged here.
110. From in or around 2021 through in or around 2023, in the District of
New Jersey, and elsewhere, the defendant,
LEON HAYNES,
did willfully attempt to evade and defeat income tax due and owing by him to the
United States of America, for the calendar years listed below, by committing the
following affirmative acts of evasion, among others:
a. Requesting that his clients pay him in cash, and accepting cash,
for preparing false Forms 941 fraudulently claiming COVID-related
tax credits; and
b. Preparing and causing to be prepared, and signing and causing
to be signed, false and fraudulent Individual Income Tax Returns,

Forms 1040, which were submitted to the IRS.

Count Tax Year Taxpayer
62 2021 LEON HAYNES
63 2022 LEON HAYNES

In violation of Title 26, United States Code, Section 7201.

38
Case 2:24-cr-00232-WJM Document16- Filed 04/03/24 Page 39 of 41 PagelD: 78

FORFEITURE ALLEGATIONS AS TO COUNTS 56-59 and 61

1. Upon conviction of the offenses charged in Counts 56 through 59 and

61 of this Indictment, the defendant,
LEON HAYNES,

shall forfeit to the United States, pursuant to Title 18, United States Code, Section
981(a)(1)(C), and Title 28, United States Code, Section 2461(c), all property, real
and personal, that constitutes or is derived from proceeds traceable to the
commission of the offenses charged in Counts 56 through 59 and 61 of this
Indictment, and all property traceable thereto.

3. If any of the above-described forfeitable property, as a result of any act
or omission of the defendant:

A. cannot be located upon the exercise of due diligence;

B. has been transferred or sold to, or deposited with, a third
person;

C. has been placed beyond the jurisdiction of the Court;
D. has been substantially diminished in value; or
EK. has been commingled with other property which cannot be

subdivided without difficulty,
Case 2:24-cr-00232-WJM Document16- Filed 04/03/24 Page 40 of 41 PagelD: 79

it is the intent of the United States, pursuant to Title 21, United States Code,
Section 853(p), as incorporated by Title 28, United States Code, Section 2461(c), to
seek forfeiture or any other property of the defendant up to the value of the above-

described forfeitable property.

A TRUE

OREPERSON

PHILIP R. SELLINGER
United States Attorney

40
Case 2:24-cr-00232-WJM Document16 - Filed 04/03/24 Page 41 of 41 PagelD: 80

CASE NUMBER: 24-232(MEF)

United States District Court
District of New Jersey

UNITED STATES OF AMERICA
LEON HAYNES

INDICTMENT FOR

26 U.S.C. § 7206(2)
18 U.S.C. § 1341
18 U.S.C. § 1028A
18 U.S.C. § 2
26 U.S.C. § 7201

A True Bill,

PHILIP R. SELLINGER
UNITED STATES ATTORNEY
FOR THE DISTRICT OF NEW JERSEY

FATIME MEKA CANO
ASSISTANT U.S. ATTORNEY
SAMUEL BEAN
U.S. DEPARTMENT OF JUSTICE TRIAL ATTORNEY
NEWARK, NEW JERSEY
973-856-9384


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