Affidavit in Support of Criminal Complaint — United States v. Hassan Kanyike (C.D. Cal.)

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U.S. District Court, Central District of California · No. 2:20-mj-05936-DUTY · Doc. 1 · 2020-12-08 · Docket on CourtListener

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1
AFFIDAVIT
I, Lori Carmack, being duly sworn, declare and state as follows:
I.
INTRODUCTION
1.
I am a Special Agent (“SA”) with the Department of 
Homeland Security, Homeland Security Investigations (“HSI”), and 
have been so employed since May 2019.
I am currently assigned 
to the El Camino Real Financial Task Force within the Los 
Angeles office.  My current duties include the investigation of 
matters concerning bank fraud, wire fraud, identity theft, money 
laundering, and other unlawful financial transactions.
2.
Prior to becoming a SA with HSI, I was employed as a 
contract forensic accountant with HSI from June 2016 to May
2019, where I was responsible for supporting HSI SAs with the 
financial review and analysis in money laundering 
investigations.
I have supported several types of 
investigations, including violations for financial, cyber, 
drugs, and trade fraud.
3.
I completed six months of training at the Federal Law 
Enforcement Training Center in Brunswick, Georgia. My training 
included, but was not limited to, instruction on customs law,
including commercial fraud, customs fraud, intellectual property 
violations and counter-proliferation; immigration law; asset 
forfeiture law; financial crimes, including check fraud, bank 
fraud, and wire fraud; money laundering, including instruction 
on schemes used to conceal and launder the proceeds of such 
crimes; child exploitation; and general drug recognition. 
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4.
Throughout the course of my career, I have conducted 
an array of criminal investigations involving money laundering, 
bank fraud, and many other unlawful schemes impacting financial 
institutions.  I have experience conducting search, seizure and 
arrest warrant operations.  Recently, I have been assigned to 
work with the U.S. Department of Justice and other law 
enforcement partners to investigate possible fraud associated 
with the stimulus and economic assistance programs created by 
the federal government in response to the COVID-19 relief
programs.
II. PURPOSE OF AFFIDAVIT
5.
This affidavit is made in support of a criminal 
complaint against, and arrest warrant for, HASSAN KANYIKE 
(“KANYIKE”) for a violation of 18 U.S.C. § 1344(2).
6.
The facts set forth in this affidavit are based upon 
my personal observations, my training and experience, and 
information obtained from various law enforcement personnel and 
witnesses.  This affidavit is intended to show merely that there 
is sufficient probable cause for the complaint and arrest
warrant and does not purport to set forth all of my knowledge of 
or investigation into this matter.  Unless specifically 
indicated otherwise, all conversations and statements described 
in this affidavit are related in substance and in part only.
III. STATEMENT OF PROBABLE CAUSE
A.
Summary of Probable Cause
7.
As set forth below, from in or around April 2020 until 
June 2020, KANYIKE perpetrated a scheme to obtain money, funds, 
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and property owned by and under the control of a financial
institution by means of false and fraudulent representations, 
pretenses, and promises.  Specifically, there is probable cause 
to believe that KANYIKE has submitted false and fraudulent 
applications in the name of “Falcon Motors” and “HK Development”
to obtain loans under the Paycheck Protection Program (“PPP”)
from financial institutions insured by the Federal Deposit 
Insurance Corporation (“FDIC”).  In addition, KANYIKE has sought 
to defraud the Small Business Administration (“SBA”) and other 
lenders and financial institutions in connection with the PPP
and the Economic Injury Disaster Loan (“EIDL”) program.
B.
Background
The Paycheck Protection Program
8.
The Coronavirus Aid, Relief, and Economic Security 
(“CARES”) Act is a federal law enacted in or around March 2020 
and designed to provide emergency financial assistance to the 
millions of Americans who are suffering the economic effects 
caused by the COVID-19 pandemic.  One source of relief provided 
by the CARES Act was the authorization of up to $349 billion in 
forgivable loans to small businesses for job retention and 
certain other expenses, through the PPP program.
In or around 
April 2020, Congress authorized over $300 billion in additional 
PPP funding.
9.
In order to obtain a PPP loan, a qualifying business 
must submit a PPP loan application, signed by an authorized 
representative of the business.  The PPP loan application 
requires the business (through its authorized representative) to 
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acknowledge the program rules and make certain affirmative 
certifications in order to be eligible to obtain the PPP loan.
In the PPP loan application, the small business (through its 
authorized representative) must state, among other things, its: 
(a) average monthly payroll expenses; and (b) number of 
employees.  These figures are used to calculate the amount of 
money the small business is eligible to receive under the PPP.
In addition, businesses applying for a PPP loan must provide 
documentation showing their payroll expenses.
10.
A PPP loan application must be processed by a 
participating lender.
Data from the application, including 
information about the borrower, the total amount of the loan, 
and the listed number of employees, is transmitted by the lender 
to the SBA in the course of processing the loan.
If a PPP loan 
application is approved, the participating lender funds the PPP 
loan using its own monies, which are 100% guaranteed by the SBA.
The SBA is a United States government agency based in 
Washington, D.C.
11.
PPP loan proceeds must be used by the business on 
certain permissible expenses, e.g., payroll costs, interest on 
mortgages, rent, and utilities.
In some instances, the PPP 
allows the interest and principal on the PPP loan to be entirely 
forgiven if the business spends the loan proceeds on these 
expense items within a designated period of time after receiving 
the proceeds and uses a certain amount of the PPP loan proceeds 
on payroll expenses. 
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The EIDL Program
12.
The EIDL program is an SBA program that provides low-
interest financing to small businesses, renters, and homeowners 
in regions affected by declared disasters.
13.
The CARES Act also authorizes the SBA to provide EIDLs 
of up to $2 million to eligible small businesses experiencing 
substantial financial disruption due to the COVID-19 pandemic.
In addition, the CARES Act authorized the SBA to issue advances 
of up to $10,000 to small businesses within three days of 
applying for an EIDL.  The amount of the advance is determined 
by the number of employees the applicant lists and certifies
having.  The advances do not have to be repaid.
14.
In order to obtain an EIDL and advance, a qualifying 
business must submit an application to the SBA and provide 
information about its operations, such as the number of 
employees, gross revenues for the 12-month period preceding the 
disaster, and cost of goods sold in the 12-month period 
preceding the disaster.  In the case of EIDLs for COVID-19
relief, the 12-month period ran from January 31, 2019 to January 
31, 2020.  The applicant must also certify that all of the 
information in the application is true and correct to the best 
of the applicant’s knowledge.
15.
EIDL applications are submitted directly to the SBA.
The amount of the loan, if the application is approved, is 
determined based, in part, on the information provided by the 
applicant about employment, revenue, and costs of goods, as 
described above.  Any funds issued under an EIDL or advance are 
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issued directly by the SBA.  EIDL funds can be used for payroll 
expense, sick leave, production costs, and business obligations, 
such as debts, rent, and mortgage payments.  If the applicant 
also obtains a loan under the PPP, the EIDL funds cannot be used
for the same purpose as the PPP funds.
C.
Relevant Entities 
16.
Based on records from the California Secretary of 
State, Falcon Motors Inc. (“Falcon Motors”) was incorporated in 
California on May 18, 2018, as a car dealership located in Van
Nuys, within the Central District of California (hereinafter,
“the Van Nuys address”).
KANYIKE is both the Chief Executive 
Officer and Chief Financial Officer of Falcon Motors.
17.
Falcon Motors maintains a business checking account 
with JP Morgan Chase (“JPMC”) ending in xxx0153.
Based on 
records received from JPMC, I know the signature card contains 
the name, signature, and social security number of “Hassan 
Shaban Kanyike,” and a business address of the Van Nuys address.
Based on my investigation, I know that KANYIKE has used this 
account to receive PPP and EIDL proceeds.
18.
HK Development International (“HK Development”) is a 
sole proprietorship run by KANYIKE.1
The business address for HK 
Development, as listed on PPP and EIDL applications, is a
residential address in Newhall, within the Central District of 
California (hereinafter, “the Newhall address”)——which is also
1 Based on documents I have reviewed, KANYIKE refers to this business 
as both HK Development and HK Developments. I understand these references to 
be to the same entity.  Hereinafter, I will refer to the business as HK 
Development.
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the same address listed by KANYIKE on his most recent California
Drivers’ License as his home address.  Based on the 
investigation, I understand that HK Development is purportedly 
involved in, at least, the retail business.
19.
KANYIKE maintains a personal checking account at Wells 
Fargo Bank (“Wells Fargo”) ending in xxx1894.  Based on records 
received from Wells Fargo, I know the signature card contains 
the name, signature, and social security number of “Hassan S 
Kanyike.”  KANYIKE listed his employer as “HK Development,” and 
uses the Newhall address as the mailing address.  Based on my 
investigation, I know that KANYIKE has used this account to 
receive PPP and EIDL proceeds.
20.
Lender 1 is a publicly traded real-estate investment 
trust headquartered in New York, New York.  Through its 
subsidiary, Lender 1 participated in the PPP as both a lender 
and a broker between borrowers and other PPP lenders. Based on 
the investigation, I understand that Lender 1 likely served as a
broker for a PPP loan that once approved, was ultimately funded 
by Bank 1, an FDIC-insured bank headquartered in West Reading, 
Pennsylvania.2
21.
Lender 2 is a non-bank finance company based in 
California that engages in lending to small businesses.
Lender
2 is an SBA Preferred Lender and participated as a PPP lender to 
small businesses.
2 Based on the investigation to date, the evidence suggests that Bank 1 
funded this loan; however, Bank 1 has not yet been able to confirm this 
point.
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22.
Bank 2 is a financial institution insured by the FDIC 
and based in Utah. Bank 2 is an SBA Preferred Lender and 
participated as a PPP lender to small businesses.
23.
Bank 3 is a financial institution insured by the FDIC 
and based in New York, New York.  Bank 3 is a SBA Preferred 
Lender and participated as a PPP lender to small businesses
24.
Bank 4 is a financial institution insured by the FDIC 
and based in Oakland, California.
Bank 4 is a SBA Preferred 
Lender and participated as a PPP lender to small businesses.
D.
Overview of Fraud
25.
As described further below, evidence gathered in the 
investigation demonstrates that between in or around April 2020 
and June 2020, KANYIKE submitted, or caused to be submitted, at 
least seven fraudulent loan applications in order to obtain 
funds through the PPP and EIDL.  In these applications, KANYIKE 
misrepresented, among other things, the total number of 
employees and expenses for these businesses.  For example, in 
his five PPP applications for Falcon Motors,3 KANYIKE
misrepresented that Falcon Motors employed—at different times to 
different lenders—between 5 and 28 individuals, and that it had 
monthly payroll expenses between $55,100 and $189,250.
In
truth, the evidence shows that KANYIKE and Falcon Motors did not 
support payroll activity of this size.
3 Four of the five applications listed “Falcon Motors Inc” as the 
applicant and one application listed “Falcon Motors.” I understand all 
applications to be related to the same entity that I have referred to here as 
“Falcon Motors.”
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26.
Additionally, KANYIKE used four different Employer 
Identification Numbers (“EIN”) in connection with his five PPP 
loan applications on behalf of Falcon Motors. I understand that 
an EIN is a unique nine-digit number assigned by the IRS to U.S. 
businesses for the purposes of identification. These four EIN 
numbers are associated with the following entity names: Falcon 
Motors Inc., Falcon Motors, Falcon Motors Lux, and Falcon Motors 
Sales.
Based on the investigation, I understand that the EIN 
for Falcon Motors Inc. was created on or about June 19, 2018 and 
that the other three EINs (Falcon Motors, Falcon Motors Lux, and 
Falcon Motors Sales) were created after February 15, 2020. In a 
PPP application, the applicant must certify that the business 
“was in operation on February 15, 2020, and had employees for 
whom it paid salaries and payroll taxes or paid independent
contractors . . . .”
Accordingly, in each of the applications
where KANYIKE listed an EIN for Falcon Motors that was created 
after February 15, 2020, he falsely certified that the business 
was in operation prior to February 15, 2020, and paid salaries
or payroll taxes during that time. Based on my training and 
knowledge of this investigation, I believe that KANYIKE secured
multiple EINs in 2020 to help hide his fraud scheme and obtain 
additional PPP loans.
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Kampala, Uganda, and listed “[KANYIKE’s FATHER] Enterprises
Kampala Ug” as the beneficiary.  These payments had no apparent 
business purpose.  Based on records reviewed in connection with 
the investigation, I understand that KANYIKE’s father lives in 
Uganda.
31.
The PPP loan and EIDL proceeds associated with HK 
Development were wired into KANYIKE’s Wells Fargo Account ending 
in xxx1894; however, based on my review of the account records,
it does not appear that KANYIKE used the funds for business 
expenses.  For example, after receiving the loans, KANYIKE 
withdrew approximately $16,275 in cash, sent $5,000 to another
account in Uganda, and sent $10,000 to Falcon Motors at JPMC 
Account xxx0153.
E.
Falsified and Successful Loan Applications
1.
Lender 1 PPP Loan to Falcon Motors 
32.
On or about April 6, 2020, Lender 1 received a PPP 
application from “Hassan Kanyike” on behalf of Falcon Motors 
Inc. seeking a PPP loan in the amount $137,500.
In the 
application, KANYIKE represented himself to be the owner of
Falcon Motors and listed the Van Nuys address as the business
address.
As the owner of Falcon Motors, the loan application 
requested KANYIKE’s residential address, and KANYIKE listed the
Newhall address.
In the PPP loan package, the EIN for Falcon 
Motors was 83-094XXXX.
33.
The PPP application submitted to Lender 1 stated that 
Falcon Motors’ average monthly payroll was $55,100 and that the 
company had five employees.
To support his application, KANYIKE 
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submitted a Payroll Summary Report for Falcon Motors that
purported to be for the period from March 28, 2019, to March 27, 
2020.  The Payroll Summary Report claimed that during this time 
period, Falcon Motors paid “$24,339.456 [sic]” in California tax 
withholding.
34.
On April 29, 2020, KANYIKE sent an email from 
hassan@hkdevelopments.com (Email Account-1) to Lender 1, and 
requested that Lender 1 increase the PPP loan amount to 
$300,000.5
The following day, KANYIKE sent another email to 
Lender 1, and attached a purported Payroll Report that listed 19 
Falcon Motors employees (including himself) and a payroll of 
$385,686 for the first quarter of 2020. 
35.
Based on the information provided to Lender 1 in the 
loan application, the initial loan request was approved and 
funded.  On or about May 6, 2020, Bank 1 appears to have wired
$137,500 into JPMC Account xxx0153.
36.
Based on my training, experience, and knowledge of the 
investigation, I believe the Falcon Motors PPP loan application
and supporting documents to Lender 1 contained several false and 
fraudulent statements.
Specifically, the loan application
claimed that Falcon Motors had five employees and paid state tax
withholdings of $24,339.456 to the state of California.
In
response to a request for records, the California Employment
Development Department (“EDD”) indicated, however, that it does
not have records of any employees being employed by Falcon
Motors for EIN 83-094XXXX for Tax Years 2019 and 2020.
5 Lender 1 ultimately denied the request to increase the loan amount.
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37.
In addition, the purported Payroll Register submitted
via email also contains false and fraudulent statements about
the number of employees and payroll expenses for those purported 
employees.
In addition to EDD not having any records of any 
Falcon Motors employees, I have reviewed JPMC Account xxx0153,
which is the business checking account for Falcon Motors, and it
does not reflect payroll payments during the first quarter of 
2020 totaling $385,686.
Second, KANYIKE provided the names of
his purported employees and the last four digits of their social
security numbers.
Several of the purported employees’ social
security numbers share the same last four digits.  For example, 
four employees share the last four digits “5284.”
Based on my 
training, experience, and knowledge of this investigation, I 
know that a social security number has three parts.  The first
set of three digits is based on the applicant’s geographic 
region; the second set of digits is the group number; and the 
final set of digits is the serial number, which runs 
consecutively from 0001 through 9999.  Based on this formatting, 
I believe it is highly improbable that Falcon Motors could have
four employees who share the same last four digits of their 
social security numbers.
2.
Lender 2 PPP Loan to Falcon Motors
38.
On or about April 30, 2020, Lender 2 received a PPP 
application from “Hassan Kanyike” on behalf of Falcon Motors 
seeking a PPP loan in the amount of $346,300.  The application 
was submitted by KANYIKE, who represented himself to be the 
owner of Falcon Motors.
KANYIKE provided a different and new 
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EIN for Falcon Motors in connection with this application: 85-
083XXXX.6
The business address listed for Falcon Motors was the
Van Nuys address.  KANYIKE did not list an email address.
As
the owner of Falcon Motors, KANYIKE also provided his
residential address as the Newhall address.7
39.
On or about May 4, 2020, KANYIKE sent an email from
Email Account-1 to a Lender 2 employee that included, among 
other things, a copy of a Falcon Motors completed PPP 
application, a copy of a purported IRS Form 941 for 2019 for 
Falcon Motors, and a purported Payroll Register Report for the 
First Quarter of 2020.
40.
Based on the information provided in the application, 
Lender 2 approved and funded the loan.  On or about May 12, 
2020, Lender 2 wired $346,300 into JPMC Account xxx0153.
41.
The PPP application submitted to Lender 2 stated that 
Falcon Motors’ average monthly payroll was $138,520 and that the
company had 18 employees.
KANYIKE submitted several purported 
federal tax documents that contained false statements; however,
the IRS has no record of these tax documents having been 
submitted on behalf of Falcon Motors.
For example, KANYIKE 
included a purported IRS Form 940 for 2019 for Falcon Motors
(EIN 85-083XXXX) that claimed that it made $1,662,240 in total
payments to its employees in 2019.
6 I understand that “Falcon Motors Sales” is the entity name associated 
with this EIN. 
7 The city name “Newhall” was cut off at “Newha” but the street number 
and street name were identical.
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42.
KANYIKE also submitted a Payroll Register Report for 
Falcon Motors purportedly for the Pay Period January 1, 2020, to
March 31, 2020, listing 19 employees (including himself) and 
claimed a total payroll of $415,560 for that period.
43.
Based on my training, experience, and knowledge of 
this investigation, I believe the statements about the number of 
employees and wages paid are false statements designed to obtain 
a PPP loan from Lender 2.  For example, in response to a request 
for records, California EDD indicated that it does not have 
records of any employees being employed by Falcon Motors for EIN 
85-083XXXX for Tax Years 2019 and 2020.
44.
As previously discussed, I have reviewed Falcon 
Motor’s business checking account (JPMC Account xxx0153) and was 
unable to find payroll expenditures for the specific employees 
and amounts that KANYIKE identified in the Payroll Register.
45.
KANYIKE once again provided the names and last four 
digits of social security numbers for his purported employees,
several of which shared the same last four digits.
46.
In addition, based on the investigation, I understand 
that EIN 85-083XXXX was created in or around April 2020.
Therefore, this entity was not in existence at the time of the 
alleged payroll expenditures.
47.
Moreover, as part of the SBA PPP loan application
process KANYIKE falsely certified that “[t]he Applicant [85-
083XXXX] was in operation on February 15, 2020 and had employees 
for whom it paid salaries and payroll taxes or paid independent 
contractors. . . .”
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48.
Finally, at the time of this PPP loan application,
KANYIKE, like all other applicants, had to certify that 
“[d]uring the period beginning on February 15, 2020 and ending 
on December 31, 2020, the Applicant has not and will not receive 
another loan under the Paycheck Protection Program.”
However,
as detailed above, at the time of this certification, KANYIKE 
had already applied for two PPP loans on behalf of Falcon 
Motors, albeit by using a different EIN.
Based on my training, 
experience, and knowledge of this investigation, I believe that 
KANYIKE applied for multiple EINs in 2020 to help hide his fraud 
scheme and obtain additional PPP loans.
3.
Bank 2 PPP Application
49.
On or about April 23, 2020, Bank 2 received a PPP 
application from “Hassan Kanyike” on behalf of “Falcon Motors 
Inc” seeking a PPP loan in the amount of $420,000.  The 
application was submitted by KANYIKE, who represented himself to 
be the owner of Falcon Motors.  The business address listed for 
Falcon Motors was the Van Nuys address.
KANYIKE provided a
different and new EIN (his third) for Falcon Motors in 
connection with this application: 85-080XXXX.8
As the owner of 
Falcon Motors, KANYIKE again listed the Newhall address in the 
application.
50.
On or about April 24, 2020, KANYIKE sent an email to 
Bank 2 and included the following supporting documents for his 
loan application: (1) a copy of his California state Drivers’ 
8 I understand that “Falcon Motors” is the entity name associated with
this EIN. 
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License, (2) a voided check from the Falcon Motors account at 
JPMC (JPMC Account xxx0153), and (3) a copy of a purported 2019
Falcon Motors tax return (IRS Form 940). Based on the 
information in the application and supporting documents, Bank 2
approved and funded the PPP loan.  On or about May 8, 2020, Bank
2 wired $420,000 into JPMC Account xxx0153.
51.
The PPP application submitted to Bank 2 stated that 
Falcon Motors’ average monthly payroll was $168,000 and that the 
company had 26 employees.
In the IRS Form 940 referenced above, 
KANYIKE represented that Falcon Motors (EIN 85-080XXXX) made 
$2,022,300 in total payments to its employees in 2019.
In
support of his application, KANYIKE also submitted a purported
IRS Form 941 (EIN 85-080XXXX) listing $504,000 in wages, tips, 
and other compensation paid in the first quarter of 2020.
Based
on my training, experience, and knowledge of this investigation,
I believe the statements about the number of employees and wages 
paid are false statements designed to obtain a PPP loan from 
Bank 2.  For example, in response to a request for records, 
California EDD indicated that it does not have records of any 
employees being employed by Falcon Motors for EIN 85-080XXXX for
Tax Years 2019 and 2020.
Additionally, the IRS has no record of 
the IRS Forms 940 and 941 included in this application that were
submitted on behalf of Falcon Motors.
52.
Based on the investigation, I understand that EIN 85-
080XXXX was created in or around April 2020 and, therefore, 
could have not made payroll payments of $2,022,300 in 2019.
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53.
KANYIKE also falsely certified again that “[t]he 
Applicant [EIN 85-080XXXX] was in operation on February 15, 2020 
and had employees for whom it paid salaries and payroll taxes or
paid independent contractors. . . .”
54.
Additionally, KANYIKE falsely certified that “[d]uring 
the period beginning on February 15, 2020 and ending on December 
31, 2020, the Applicant has not and will not receive another 
loan under the Paycheck Protection Program.”  As detailed above, 
at the time of this certification, KANYIKE had already submitted 
multiple applications for PPP loans on behalf of Falcon Motors, 
albeit by using different EIN numbers.
4.
HK Development Application to Bank 2
55.
On or about April 11, 2020, Bank 2 received a PPP 
application from HK Developments, seeking a PPP loan in the 
amount of $98,750.  KANYIKE listed the business address and
residential address as the Newhall address.
56.
The PPP application submitted to Bank 2 stated that HK 
Development’s average monthly payroll was $44,080 and that the 
business had eight employees.
To support the application, 
KANYIKE submitted a purported “Payroll Summary Report” for HK 
Development that, among other things, represented that between
March 28, 2019, and March 27, 2020, HK Development paid $528,960
in wages and $12,575.39 in California state tax withholdings.
57.
Based on the information in the application, Bank 2
approved and funded the PPP loan.  On or about April 20, 2020,
Bank 2 wired $98,750 to Wells Fargo Account xxx1894.
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58.
Based on my training, experience, and knowledge of 
this investigation, I believe the statements about the number of 
employees and wages paid are false statements designed to obtain 
a PPP loan from Bank 2.  For example, in response to a request 
for records, California EDD could not locate records of any 
employees being employed by the EIN associated with HK
Development (46-406XXXX) for Tax Years 2019 and 2020.
59.
I have also reviewed the Wells Fargo checking account 
ending in xxx1894 identified in the application to Bank 2, and
was unable to find payroll expenditures consistent with the 
representations in the loan application and Payroll Summary
Report.
5.
SBA EIDL Loan on behalf of HK Development 
60.
On or about June 15, 2020, KANYIKE applied for an EIDL 
from the SBA on behalf of HK Development.
In the application, 
KANYIKE provided the business address as the Newhall address.
61.
The application to the SBA occurred approximately two 
months after KANYIKE applied for a PPP loan from Bank 2 for HK 
Development.
This time, however, KANYIKE represented that HK 
Development had almost double the number of employees.
Specifically, KANYIKE submitted an application to the SBA and 
represented that HK Development had 15 employees (compared to 8 
employees listed in the application to Bank 2).
In support of 
his application, KANYIKE also represented that HK Development’s
gross revenues for the 12 months prior to the date of disaster 
totaled $1,600,000, and that the cost of goods sold for the 12 
months prior to the date of disaster totaled $820,000. 
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62.
Based on the information provided to the SBA in the 
application, SBA approved and funded the loan.  On or about June 
22, 2020, SBA wired $149,900 to Wells Fargo Account xxx1894.
63.
Based on my training, experience, and knowledge of 
this investigation, I believe the statements about the number of 
employees, revenues, and expenses are false statements designed 
to obtain an EIDL from the SBA.  For example, California EDD 
could not locate records of any employees being employed by the
EIN associated with HK Development (46-406XXXX) for Tax Years
2019 and 2020.
64.
I have also reviewed account activity for Wells Fargo 
Account xx1894, which received the EIDL funds, and it does not 
reflect either the gross revenues figures, or costs of goods 
sold figures represented in the EIDL application.
F.
Falsified and Failed Loan Applications
1.
Bank 3 PPP Loan Application
65.
On or about April 7, 2020, Bank 3 received a PPP 
application from “Hassan Kanyike” on behalf of Falcon Motors 
seeking a PPP loan in the amount of $145,000. The EIN for 
Falcon Motors in connection with this application was 83-
094XXXX, which was the same EIN used in the Lender 1
application.
The application listed KANYIKE as the “contact.”
66.
Based on the information provided in the application,
Bank 3 rejected the application.
67.
The PPP application submitted to Bank 3 stated Falcon
Motors’ average monthly payroll was $58,000 and that the company 
had eight employees.
The PPP application included a purported
Case 2:20-mj-05936-DUTY   Document 1   Filed 12/08/20   Page 21 of 27   Page ID #:21

IRS Form 941 for the first quarter of 2020. The IRS Form 941 
claimed that Falcon Motors had paid $168,500 in wages, tips, and 
other compensation. The application also included a purported
Payroll Summary Report for Falcon Motors from March 28, 2019 to
March 27, 2020, which claimed that during this time period, 
Falcon Motors paid “$24,339.456 [sic]” in California tax 
withholding.
68.
Based on my training, experience, and knowledge of 
this investigation, I believe the statements about the number of 
employees and wages paid are false statements designed to obtain 
a PPP loan from Bank 3.  For example, in response to a request 
for records, California EDD indicated that it does not have
records of any employees being employed by Falcon Motors for EIN 
83-094XXXX for Tax Years 2019 and 2020. 
69.
Additionally, KANYIKE falsely certified that “[d]uring
the period beginning on February 15, 2020, and ending on 
December 31, 2020, the Applicant has not and will not receive 
another loan under the Paycheck Protection Program.”  As 
detailed above, at the time of this certification, KANYIKE had 
already submitted an application for a PPP loan on behalf of 
Falcon Motors to Lender 1 using the same EIN number.
2.
Bank 4 PPP Loan Application
70.
On or about May 8, 2020, Bank 4 received a PPP
application from KANYIKE on behalf of Falcon Motors seeking a 
PPP loan in the amount $473,125.
The application was submitted 
by KANYIKE, who represented himself to be the owner of Falcon 
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Motors.  KANYIKE provided a different and new EIN (his fourth) 
for Falcon Motors in connection with this application: 85-
094XXXX.9
The business address listed for Falcon Motors was the 
Van Nuys address.  As the owner of Falcon Motors, KANYIKE also 
provided his residential address as the Newhall address.
71.
On or about May 15, 2020, KANYIKE sent an email to an 
employee at Bank 4 titled “Falcon Motors Inc- Paperwork.”
KANYIKE attached the following documents to his email: (1) the 
Articles of Incorporation filed with the California Secretary of 
State on behalf of Falcon Motors Inc, (2) City of Los Angeles 
Tax Registration Certificates for Falcon Motors Inc, and
(3) Statement of Information for Falcon Motors Inc filed with 
the California Secretary of State. 
72.
Based on the information provided in the application, 
Bank 4 rejected the application.
73.
The PPP application submitted to Bank 4 stated that 
Falcon Motors’ average monthly payroll was $189,250 and that the 
company had 28 employees. KANYIKE included a purported IRS Form 
940 for 2019 that contained false statements. The IRS has no 
record of this IRS Form 940 having been submitted on behalf of 
Falcon Motors.
In the IRS Form 940, KANYIKE claimed that Falcon 
Motors made $2,271,000 in total payments to its employees in 
2019.
74.
KANYIKE also submitted a purported Payroll Register 
Report for Falcon Motors for the Pay Period January 1, 2020, to
9 I understand that “Falcon Motors Lux” is the entity name associated 
with this EIN. 
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March 31, 2020, listing 28 employees (including himself) and 
claimed a total payroll of $473,125 for the period.
75.
Based on my training, experience, and knowledge of 
this investigation, I believe these statements about the number 
of employees and wages paid are false statements designed to 
obtain a PPP loan from Bank 4.  For example, in response to a 
request for records, California EDD indicated that it does not 
have records of any employees being employed by Falcon Motors 
for EIN 85-094XXXX for Tax Years 2019 and 2020.
76.
As previously discussed, I have reviewed Falcon 
Motor’s business checking account (JPMC Account xxx0153) and was 
unable to find payroll expenditures for the specific employees 
and amounts that KANYIKE identified in the Payroll Register.
77.
KANYIKE once again provided the names and last four 
digits of social security numbers for his purported employees, 
several of which shared the same last four digits.
78.
In addition, based on the investigation, I understand 
that EIN 85-094XXXX was created in or around May 2020.
Therefore, this entity was not in existence at the time of the 
alleged payroll expenditures.
79.
Moreover, as part of the SBA PPP loan application 
process KANYIKE falsely certified that “[t]he Applicant [85-
094XXXX] was in operation on February 15, 2020 and had employees 
for whom it paid salaries and payroll taxes or paid independent 
contractors. . . .” 
80.
Finally, at the time of this PPP loan application, 
KANYIKE, like all other applicants, had to certify that that 
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“[d]uring the period beginning on February 15, 2020 and ending 
on December 31, 2020, the Applicant has not and will not receive 
another loan under the Paycheck Protection Program.”  In issuing 
this certification, KANYIKE also provided fraudulent information
to Bank 4.  As detailed above, at the time of this 
certification, KANYIKE had already applied for several PPP loans 
on behalf of Falcon Motors, albeit by using different EINs.
Based on my training, experience, and knowledge of this 
investigation, I believe that KANYIKE applied for multiple EINs 
in 2020 to help hide his fraud scheme and obtain additional PPP 
loans.
G.
Additional Information that Connects KANYIKE to the 
Fraudulent PPP Applications 
81.
As mentioned above, in connection with the submission 
of his PPP applications, KANYIKE used email.  Specifically, he 
used Email Account-1 to communicate with employees from Lender 
1, Lender 2, and Bank 4.  These communications included the 
following:
a.
On or about April 29, 2020, KANYIKE sent an email 
from Email Account-1 to Lender 1, and requested that Lender 1
increase the PPP loan amount to $300,000.
b.
On or about May 15, 2020, KANYIKE sent an email 
from Email Account-1 to an employee at Bank 4 titled “Falcon 
Motors Inc- Paperwork.”  KANYIKE attached the following 
documents to his email: (1) the Articles of Incorporation filed 
with the California Secretary of State on behalf of Falcon 
Motors Inc, (2) City of Los Angeles Tax Registration 
Case 2:20-mj-05936-DUTY   Document 1   Filed 12/08/20   Page 25 of 27   Page ID #:25

Certificates for Falcon Motors Inc, and (3) Statement of 
Information for Falcon Motors Inc filed with the California 
Secretary of State.
82.
In connection with the submission of his PPP 
application, KANYIKE used the email account 
hassanshaban2012@gmail.com (Email Account-2) to communicate with 
employees from Bank 2.  Specifically, on or about April 24, 
2020, KANYIKE sent an email from Email Account-2 that included 
the following supporting documents for his loan application: (1) 
a copy of his California state Drivers’ License, (2) a voided 
check from the Falcon Motors account at JPMC (JPMC Account 
xxx0153), and (3) a copy of a purported 2019 Falcon Motors IRS 
Form 940. 
83.
In connection with the investigation, I have reviewed 
IP Logins associated with these two email accounts.  On or about 
April 6 and 7, 2020, KANYIKE logged into Email Account-1 at the 
IP Address 108.185.253.14.  On or about March 31, April 7, and 
April 20, 2020, KANYIKE logged into Email Account-2 at the IP 
address 108.185.253.14.
84.
According to records from Charter Spectrum, an 
internet service provider, the IP address 108.185.253.14 was 
registered in the name of KANYIKE at the Newhall address from 
November 11, 2019, until September 18, 2020, the date that 
Charter responded to the records request.  The listed “User 
Name” is hassan@hkdevelopments.com.
85.
Additionally, I have also reviewed records of IP 
address logins associated with JPMC Account xxx0153, the Bank 
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account that received multiple fraudulent loan disbursements.
The logins are associated with the UserID “falconmotors2” and 
the email address hassan@hkdevelopments.com.  I have identified 
several log-ins during April and May 2020 at the IP address 
108.185.253.14, which, as described above, is registered to 
KANYIKE at the Newhall Address. 
IV.
CONCLUSION
86.
Based on the foregoing, there is probable cause to
believe that on or about April 23, 2020, KANYIKE knowingly and 
with the intent to defraud executed a scheme to obtain money, 
funds, and property from Bank 2 by means of materially false and 
fraudulent representations, pretenses, and promises, namely, 
KANYIKE submitted an application for a PPP loan in the name of 
Falcon Motors that contained false representations about the 
number of employees and the amount of monthly payroll that 
Falcon Motors had, in violation of Title 18, United States Code, 
Section 1344(2). 
Attested by telephone on 12/8/2020 to me.
__
_
Charles F. Eick
United States Magistrate Judge
________________________
Agent Lori Carmack
Case 2:20-mj-05936-DUTY   Document 1   Filed 12/08/20   Page 27 of 27   Page ID #:27

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