Man Admits to Using Federally Backed Loans to Pay Off Gambling Debts
NEWARK, N.J. (Associated Press) — A New Jersey man has pleaded guilty to using federally backed loans for gambling debts and other personal expenses.
NJ.com reports (http://bit.ly/2tJK1sQ ) 58-year-old John Cheng, of New Brunswick, pleaded guilty to loan application fraud Wednesday. Cheng faces up to 30 years in prison.
Prosecutors say Cheng applied for a $1.75 million federal Small Business Administration loan along with a $2 million commercial loan in order to finance a restaurant in December 2007. Officials say Cheng received more than $2 million in loans in March 2008.
Authorities say Cheng spent the money on family members, a tax bill and gambling debts instead of construction for the restaurant.
Cheng must pay $2.6 million in restitution.
Sentencing is scheduled for October.
