NJ Business Owner Charged With $3.2M COVID Loan Fraud Scheme
Federal authorities say the owner of several New Jersey businesses has been charged with fraudulently obtaining over $3.2 million in Paycheck Protection Program (PPP) loans.
47-year-old Daniel Dadoun, formerly of South Plainfield, who holds French, Canadian and Israeli passports, was charged with four counts of bank fraud and two counts of transacting in criminal proceeds.
It is alleged that from April 2020 through August 2022, Dadoun engaged in a scheme to illegally obtain over $3.2 million in PPP loans on behalf of businesses located in New Jersey by submitting false and fraudulent loan applications.
After receiving the PPP loan proceeds, Dadoun sought to keep the money by submitting false and fraudulent PPP loan forgiveness applications. The loan applications misrepresented information about the companies, including the number of employees and payroll expenses. In support of the loan applications and subsequent applications for loan forgiveness, Dadoun submitted falsified tax documents, altered and falsified bank statements, an altered and falsified lease agreement, and a false letter purportedly signed by a New Jersey accountant.
The charges of bank fraud each carry up to 30 years in prison and a $1 million fine. The charges of transacting in criminal proceeds each carry up to a decade behind bars and a $250,000 fine.
Dadoun made his initial appearance in Newark federal court on Monday and was ordered detained.
U.S. Attorney Philip Sellinger said in a statement,
The allegations in this complaint describe the falsifying of documents in order to secure loans and then submitting fraudulent documents to have those loans forgiven. These programs were designed to help Americans struggling through the pandemic. Our office will combat this type of fraud whenever we encounter it.
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