Telecom executive found guilty of tax charges - Hawaii News Now - KGMB and KHNL

Telecom executive found guilty of tax charges

HONOLULU (HawaiiNewsNow) -

It was a stunning fall from grace for a downtown power broker who built a rural phone service into one of the state's largest telecommunications companies.

A federal jury took less than two days to reach its verdict against Albert Hee, finding him guilty on six counts of filing a false tax return and a single count of interfering with the Internal Revenue Service. Each count is punishable by up to three years in jail.

The 60-year-old Hee is the younger brother of former state Sen. Clayton Hee and founder of Sandwich Isles Communications. Many believe Hee built the company by capitalizing on his political connections.

"It seems hard to deny that political connections were not a major factor here. Here you have somebody related to one of the most powerful people in Hawaii politics," said Colin Moore, University of Hawaii Political Science Professor and Hawaii News Now political analyst.

"(There are) many politically powerful people on the board.  It's a company whose growth and survival depended on federal dollars."

Sandwich Isles' board includes Kamehameha Schools trustee Janeen Olds and former trustee and retired Admiral Robert Kihune. Over the past decade, the company has received more than $400 million in low-interest federal loans.

His lawyers said they're considering an appeal.

"(We're) very disappointed. We truly believe Mr. Hee was innocent of all of the charges. We look forward to post verdict proceedings," said attorney Steven Toscher.

Sandwich Isles provides telecommunications services for more than 6,400 native Hawaiians living on homestead land. The company was established in 1995 to provide phone services for this under served population but prosecutors said that Hee would up using it to serve his own personal needs.

According to an indictment last year, Sandwich Isle's parent company, Waimana Enterprises, paid more than $4 million in Hee's personal expenses.

Prosecutors alleged that Hee convinced the company to disguise the purchases as legitimate business expenses.

Those expenses included $718,000 for his children's college expenses, $590,000 in wages for his wife and $92,000 for his own therapeutic massages.

Sandwich Isles said Hee's conviction will have no impact on its daily operations.

"We remain committed to our mission … of providing quality telecommunications services to Native Hawaiians," the company said.

Hee's sentencing is scheduled for October. Each of the seven tax charges carries a maximum sentence of three years.

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