Who Is the Prophet Daniel?
Question

I have a question regarding the prophet Daniel. Who was he and is it true that during the reign of ‘Umar that some of the Companions found him and reburied him?
Praise be to Allah.Who is Prophet Daniel? 
More than one of the scholars of history and biography have stated that Daniel was one of the Israelite Prophets. He lived at the time of Nebuchadnezzar who destroyed Bayt al-Maqdis (the Temple in Jerusalem), killed many of the Children of Israel, and burned the Torah.
Did Prophet Daniel foretell the coming of Prophet Muhammad?
Scholars said that Prophet Daniel foretold the coming of our Prophet Muhammad (blessings and peace of Allah be upon him). Shaykh al-Islam Ibn Taymiyah (may Allah have mercy on him) said:
Daniel (peace be upon him) mentioned Muhammad the Messenger of Allah (blessings and peace of Allah be upon him) by name, and said: “Arrows will be departing from bows and arrows will be stained with blood at your command, O Muhammad.”
This is a clear, unambiguous statement.
Then Shaykh al-Islam mentioned two cases in which Daniel foretold the coming of the Messiah and of our Prophet Muhammad (blessings and peace of Allah be upon them both), then he said:
“This is a prophecy in which Daniyal foretold the coming of the Messiah and the coming of Muhammad (blessings and peace of Allah be upon him), in which there is a detailed description of Muhammad and his ummah, which would take too long to quote here. The Muslims read it when they conquered Iraq, as was mentioned by the scholars, including Abu’l-‘Aliyah.” (Al-Jawab as-Sahih (5/275-281)
Did ‘Umar instruct the Companions to rebury Prophet Daniel?
It is well known that when the Muslims conquered Tastar, they came across the grave of Prophet Daniel (peace be upon him), and Amir al-Muminin ‘Umar (may Allah be pleased with him) instructed the Companions to rebury him and conceal from the people the location of his grave, lest that be a cause of fitnah and confusion.
Ibn Abi’d-Dunya narrated with a hasan isnad – as it says in al-Bidayah wa'an-Nihayah – from Abu’z-Zinad that he said:
“I saw a ring on the hand of Abu Burdah ibn Abi Musa al-Ash‘ari, on the bezel of which there was an engraving of two lions, between whom was a man, and they were licking that man. Abu Burdah said: This is the ring of that dead man whom the people of this city claim is Daniel. Abu Musa took it on the day they reburied him. Abu Burdah said: Abu Musa asked the scholars of that city about the engraving on that ring, and they said: The astrologers and scholars came to the king under whose rule Daniel lived and told him: On such and such a night, a boy will be born who will undermine your sovereignty. The king said: By Allah, no boy will survive that night but I will kill him. But they took Daniel and threw him into the lions’ den, where the lion and lioness licked him but did not harm him, then his mother came and found the lions licking him. Thus Allah saved him until he grew up and achieved what he achieved. Abu Burdah said: Abu Musa said: The scholars of that city said: Therefore Daniel engraved his image and the image of the two lions licking him on the bezel of his ring, lest he forget that blessing that Allah had bestowed upon him.”
Ibn Abi Shaybah (7/4) narrated with a sahih isnad from Anas that when they conquered Tastar, they found a man whose nose was one cubit long in a coffin, and they used to pray for victory and for rain by virtue of him. Abu Musa wrote to ‘Umar ibn al-Khattab about that, and ‘Umar wrote back, saying: This man is one of the prophets; fire does not consume (the bodies of) the prophets and the earth does not consume (the bodies of) the prophets. And he wrote instructions saying: You and your companions (meaning the companions of Abu Musa) should discuss the matter and rebury him in a place that no one knows except you two. He said: So Abu Musa and I went and reburied him.
Ibn Abi Shaybah (7/4) narrated with a sahih isnad from Mutarrif ibn Malik that he said: I was present at the conquest of Tastar with al-Ash‘ari. We came across (the body of) Daniel in as-Sus. When the people of as-Sus were faced with drought, they would bring him out and pray for rain by virtue of him. We found with him sixty sealed jars…
Al-Bayhaqi said in Dalail al-Nubuwwah (1/381):
“It was narrated from Khalid ibn Dinar that Abu’l-‘Aliyah said: When we conquered Tastar, we found in the treasury of al-Hormuzan a bier on which was the body of a dead man, and by his head was a scripture of his. We seized the scripture and took it to ‘Umar ibn al-Khattab (may Allah be pleased with him), and he summoned Ka‘b, who translated it into Arabic. I was the first man among the Arabs to read it, and I read it as I read this Quran.
I said to Abu’l-‘Aliyah: What was in it? He said: It was about you, your affairs, your religion, your talk, and what will happen after that. I said: What did you do with the man? He said: We dug thirteen different graves during the day, then at night we buried him and we levelled all the graves, so as to conceal its location from the people, so that they would not exhume him. I said: Why would people do that? He said: If rain was withheld from them, they would take his bier out and they would receive rain. I said: Who do you think the man was? He said: A man called Daniel. I said: How long ago do you think he died? He said: Three hundred years ago. I said: Had anything of him changed? He said: No, except a few hairs at the back of his head, for the earth does not consume (the bodies of) the prophets, and wild animals cannot devour them.”
Ibn Kathir (may Allah have mercy on him) said:
“This is a sahih isnad going back to Abu’l-‘Aliyah, but if the date of this man’s death was recorded as having been three hundred years earlier, then he cannot have been a prophet; rather he was a righteous man. That is because there was no prophet between ‘Isa ibn Maryam and the Messenger of Allah (blessings and peace of Allah be upon him), according to the text of the hadith narrated by al-Bukhari, and the period between them was four hundred years, or six hundred, or six hundred and twenty years. Or the date of his death may have been eight hundred years earlier, which is close to the time of Daniel, if this was the Daniel who once lived. Or he may have been some other man, either one of the prophets or one of the righteous. But it is most likely that he was Daniel, because Daniel was taken captive by the king of Persia, and remained with him as a prisoner, as we have seen above. It was narrated with a sahih isnad going back to Abu’l-‘Aliyah that the length of his nose was a handspan, and it was narrated with a sahih isnad going back to Anas ibn Malik that the length of his nose was a cubit. Therefore it is possible that this was one of the earlier prophets, before the period mentioned above. And Allah knows best.” (Al-Bidayah wa'an-Nihayah, 2/40)
Shaykh al-Islam Ibn Taymiyah (may Allah have mercy on him) said:
“When the grave of Daniel was discovered in Tastar, Abu Musa wrote to ‘Umar ibn al-Khattab (may Allah be pleased with him) about it, and ‘Umar wrote back to him, saying: During the day, dig thirteen graves, and bury him by night in one of them, and conceal the location of his grave, lest his grave be a cause of fitnah and confusion for people.” (Majmu‘ al-Fatawa, 15/154)
References:

Sirat Ibn Ishaq (p. 66); 
Tarikh Baghdad (1/361); 
Tarikh Dimashq (8/32); 
al-Masalik wa’l-Mamalik (p. 92); 
A‘lam an-Nubuwwah (p. 66); 
Ahsan at-Taqasim (p. 417); 
al-Jawab as-Sahih (5/276); 
Hidayat al-Hayara (2/375); 
al-Bidaayah wa’n-Nihaayah (2/374); 
Siyar A‘lam an-Nubala (2/312)

For more about prophets, please see this category: Belief in Messengers. 
And Allah knows best.