A former New Jersey business owner has pled guilty to federal charges of unlawfully obtaining more than $3.2 million in Paycheck Protection Program (PPP) loans designed to help businesses during the COVID-19 outbreak, according to U.S. Attorney Alina Habba.
Daniel Dadoun, 48, an Israeli citizen and former South Plainfield, New Jersey resident, pleaded guilty before U.S. District Judge Robert Kirsch to one count each of bank fraud and money laundering. Sentencing is planned for August 13, 2025.
According to prosecution documents and testimonies, Dadoun had various businesses in New Jersey and submitted numerous fake PPP loan applications between April 2020 and August 2022. These applications contained misleading information on employee counts and payroll expenses. Dadoun misled financial institutions and the Small Business Administration by providing fake tax records and changed bank statements to support his loan and forgiveness requests.
Dadoun allegedly submitted more false loan forgiveness applications to avoid payback, misrepresenting his firms’ credentials and continuous eligibility for federal relief.
The maximum term for bank fraud is 30 years in jail and a $1 million fine—or double the gain or loss associated with the conduct, whichever is larger. The money laundering offense carries a maximum sentence of ten years in jail and a $250,000 fine, or twice the amount laundered.
The case was probed by several federal authorities, including Homeland Security Investigations (HSI) Newark, the IRS Criminal Investigation – New York Field Office, the Social Security Administration’s Office of the Inspector General, and the United States Attorney’s Office for the District of New Jersey. The investigation was overseen by the COVID-19 Crime Enforcement Strike Force, a Department of Justice project aimed at large-scale pandemic-related financial crime.
Katherine M. Romano is prosecuting the case as the Assistant United States Attorney for the Health Care Fraud Unit in Newark.
Federal authorities continue to encourage people to report potential COVID-19 relief fraud to the National Center for Disaster Fraud by calling 866-720-5721 or filling out the online complaint form at justice.gov/disaster-fraud.