NJ Man Gets Four Years in Prison for Tax Fraud and Theft from Elderly Victim

James Mastrogiovanni fraudulently claimed over $1.4 million in COVID-related tax credits and stole $180,000 from an 85-year-old customer, resulting in a 49-month federal prison sentence.

MORRISTOWN, N.J. — A Washington Township man has been sentenced to 49 months in federal prison for orchestrating a fraudulent tax scheme that targeted COVID-19 relief programs and for stealing more than $180,000 from an elderly customer at a car dealership, federal authorities announced.

James J. Mastrogiovanni, 45, was sentenced on December 4, 2025, by U.S. District Judge William J. Martini in Newark federal court. He previously pleaded guilty on May 20, 2025, to four felony charges: conspiracy to defraud the United States, mail fraud, money laundering, and access device fraud.

According to court documents and statements made in court, Mastrogiovanni conspired with tax preparer Leon Haynes to exploit the IRS’s COVID-19 pandemic relief efforts. From March 2021 through December 2022, the pair filed false Forms 941—used to report employment taxes—on behalf of Mastrogiovanni, his relatives, and others. These forms fraudulently claimed Employee Retention Credits, a federal benefit intended to help struggling small businesses retain employees during the pandemic.

However, investigators found that Mastrogiovanni and his family members neither owned nor operated businesses and had no employees. Despite this, the IRS disbursed approximately $545,692 based on the falsified claims, with Mastrogiovanni seeking over $1.4 million in total.

Haynes, his co-conspirator, was found guilty by a jury on November 10, 2025, of filing more than 1,900 false tax returns, seeking upwards of $170 million in fraudulent refunds. He is scheduled to be sentenced on March 12, 2026.

Theft from Elderly Victim

In a separate scheme, Mastrogiovanni was also found to have stolen over $180,000 from an 85-year-old customer between June and December 2023. The victim, who had issued a check to purchase a vehicle from the dealership where Mastrogiovanni worked, unknowingly had their bank information misused. Mastrogiovanni exploited the routing and account numbers on the check to conduct unauthorized withdrawals and transactions until the account was drained.

Sentencing and Restitution

Alongside the prison sentence, Mastrogiovanni was ordered to serve three years of supervised release following his incarceration. He must also pay $726,862 in restitution.

The case was investigated by special agents from several federal and local agencies, including the IRS–Criminal Investigation division, the Social Security Administration’s Office of the Inspector General, the U.S. Postal Inspection Service, and the Mahwah Police Department.

Assistant U.S. Attorneys Matthew Stark and Fatime Meka Cano of the Economic Crimes Unit in Newark prosecuted the case.

COVID-19 Fraud Enforcement

Mastrogiovanni’s case was prosecuted as part of the District of New Jersey COVID-19 Fraud Enforcement Strike Force, one of five such teams established by the U.S. Department of Justice. These task forces target large-scale fraud involving pandemic relief funds, particularly schemes involving criminal organizations or multi-state operations.

Federal authorities continue to urge the public to report suspected COVID-19-related fraud by calling the National Center for Disaster Fraud at 866-720-5721 or submitting tips through the DOJ’s online complaint form.