A federal grand jury has indicted Waimana Enterprises President Albert Hee on seven counts of corrupt interference with the administration of the internal revenue laws and six counts of submitting a false tax return.  

The indictment, announced Wednesday afternoon, supersedes a prior one-count indictment in September 2014 that had charged Hee with a false tax return.

Hawaii’s U.S. Attorney Florence Nakakuni said the superseding indictment alleges that for a decade, from 2002 to 2012, the Honolulu businessman tapped Waimana Enterprises Inc. — a company Hee incorporated and owns stock in — to pay $4 million of his personal expenses, including:

>> $718,559 for tuition, books and rent for Hee’s three college-age children; 

>> $1.3 million for a house in Santa Clara, Calif., used exclusively by Hee’s two children; 

>> $33,523 in college tuition payments for Hee’s child; 

>> $92,000 for massages for Hee; 

>> $121,878 in credit card charges by Hee;

>> $722,550 in false wages paid to Hee’s three children, who did no work for WEI;

>> $590,201 in false wages paid to Hee’s wife, who did no work for WEI; 

>> $443,103 in false employment benefits paid on behalf of Hee’s three children and wife; 

>> and $28,216 in cash withdrawals by Hee.

The indictment states that Hee instructed an employee of WEI to pay some of the expenses and classify them as business educational expenses. Hee’s return preparer then reclassified the expenses as loans, according to a news release issued by the U.S. Attorney’s Office.

Hee did not claim the $4,063,294.39 in personal expenses that WEI paid, which should have been reported as income on his personal tax returns filed for the years 2002 to 2012, resulting in personal federal taxes due in the amount of $425,988, according to the indictment.

Because Hee improperly deducted some of the personal expenses as business expenses, WEI underpaid its federal corporate taxes by $140,651, according to the indictment.

If convicted, Hee faces up to three years imprisonment and a fine of up to $250,000 on each of the 13 charges.  

The investigation of this case was conducted by the Internal Revenue Service’s Criminal Investigation Division.

In September 2014, Hee, who is also president of Sandwich Isles Communications, was charged with making a false statement on his 2007 income tax return.

A federal grand jury indictment said Hee reported that his income was $183,464 when it was really $438,928.

Sandwich Isles Communications, a subsidiary of Waimana Enterprises Inc., provides telephone and high-speed Internet service to customers living on Hawaiian Home Lands. To provide the service, Sandwich Isles receives a federal subsidy from a program funded by a fee of up to $2.75 charged on every phone bill.

The Federal Communications Commission, which oversees the program, said last year it was cutting the subsidy to $250 per Sandwich Isles customer from about $830 per customer.

Hee is the brother of former state Sen. Clayton Hee.