After spotting the two in their FBI get-up, the security at the club warn Hector that a few agents are in attendance. At this point, he seems super on edge. As a result, this leads viewers to believe that he is most likely a wanted criminal. Hector soon reveals his dark side, threatening Miguel and questioning if he’s with the FBI, which forces him to realize his father is not a good man after all.
Source: https://www.distractify.com/p/who-is-miguels-father-cobra-kai