Former CFO John Dunlea Convicted of $1.5 Million in Tax Fraud and Embezzlement

MORRIS COUNTY — Attorney General Matthew J. Platkin upheld the conviction of a Union County man who was formerly the chief financial officer of a rural law firm in Morristown after he admitted embezzling more than $1.5 million from the firm and evading payment of income taxes owed to the state.

John Dunlea, 61, of Westfield, was sentenced July 26 to five years in prison by New Jersey Superior Court Judge Stephen J. Taylor, presiding at the Morris County Courthouse in Morristown. He was also ordered to pay more than $1.5 million to McElroy, Deutsch, Mulvaney & Carpenter, LLP, the firm where he previously worked, and to pay more than $20,000 to the state in restitution.

Dunlea pleaded guilty on May 8 to two counts of second-degree theft by deception and five counts of third-degree failure to pay taxes.

In entering the plea, Dunlea admitted to embezzling $1,538,221 from the law firm by paying himself improper overcompensation. Between January 2017 and December 2022, he paid himself improper compensation of $1,182,965. He deceived the firm into paying his personal credit card charges for international and domestic flights, hotels, and restaurant outings for himself and his family, totaling approximately $355,256.

Dunlea also admitted to evading payment of state income taxes totaling $22,568 for tax years 2018 through 2022 on income from the credit card scheme.

“The defendant admitted to giving himself a staggering, unwarranted and illegal seven-figure raise and treating himself and his family to travel, hotels and meals at his employer’s expense,” Platkin said. “Today’s sentence demonstrates the Division of Criminal Justice’s steadfast commitment to holding accountable those who abuse positions of trust to commit financial fraud.”

“The defendant abused his position of power and trust to take advantage of his employer and the taxpayers of New Jersey,” said Chief Legal Officer Pablo Quiñones of the Office of Securities Fraud and Financial Crimes Prosecutions. “This sentence underscores our commitment to ensuring that those who turn to deceit and fraud to improperly enrich themselves are held accountable.”