A Santa Clarita Valley man was sentenced Monday to 51 months in federal prison after he previously pleaded guilty to fraudulently claiming $1.8 million in COVID-19 relief funds.
Hassan Kanyike, 30, was given the sentence in a federal courtroom and ordered to pay a $20,000 fine and $1,302,550 in restitution to the Small Business Administration and four of his victim lenders after pleading guilty to one count of wire fraud on March 29.
“From April 2020 to June 2020, Kanyike submitted six fraudulent (Paycheck Protection Program, or PPP) loan applications and two fraudulent (Economic Injury Disaster Loan, or EIDL) applications,” read a statement from the Central District of California U.S. Attorney’s Office, which prosecuted the case. “The applications sought funds to purportedly pay the salaries of employees whom he claimed worked for two of his businesses. Kanyike successfully obtained approximately $1 million through four PPP loans, and another $300,000 through two EIDL loans.”
In order to ensure he would receive the funds, Kanyike reportedly created false tax filings and payroll reports when, in reality, he had no employees on payroll and had received Employer Identification numbers from the Internal Revenue Service.
“For example, in one loan application, Kanyike falsely claimed the business had 26 employees and an average monthly payroll of $168,000, and he submitted a fabricated IRS tax form claiming Falcon Motors had paid $2,022,300 to employees in 2019,” reads the U.S. Attorney’s Office statement about the case. “At the time of his arrest in December 2020, Kanyike had transferred approximately $762,000 to Uganda, his country of citizenship, from one of the business accounts that had received the loan proceeds, in violation of the terms of the PPP and EIDL program.”
In total, the 30-year-old was approved for six of the eight total loans he applied for, receiving $1,302,550 out of the total requested amount of $1.8 million.
Both the Department of Homeland Security and the Treasury Inspector General for Tax Administration investigated the case.
