Holland sentenced to prison, $1.4 million in fees

SHARON — Albert Holland, 70, of Sharon, was sentenced Sept. 1 by United States District Judge Janet Bond Arterton in New Haven to 36 months of imprisonment, followed by three years of supervised release, for evading the payment of more than $1.4 million in federal taxes.  

Holland was found guilty on April 15 of one count of tax evasion and two counts of filing false tax returns.

Holland’s case had been investigated by the criminal investigation division of the Internal Revenue Service (IRS).

The investigation began in 1998, according to a statement released this week by the office of the United States attorney for the District of Connecticut.

In 1998, the IRS notified Holland that he owed $1,421,498.67 in unpaid taxes, penalties and interest dating back to 1979.  The agency said he had either not filed a tax return or had underpaid his taxes for several years since that time.  

In November 1998, Holland made an Offer in Compromise with the IRS that claimed that he was only able to pay $120,000 of the debt.

However, according to the press release, at the time Holland was trying to negotiate that lower payment, he was involved in a lawsuit in which his partnership had demanded from Active Media Services millions of dollars for services that Holland and his partner (who is  unnamed in the press release) had rendered.  

In an internet search for Active Media Services, several sites describe a Pearl River, N.Y., company by that name in these terms: “Take a pawn shop, cross it with a factoring service, and you have Active Media Services.�

The IRS rejected Holland’s compromise offer, and he challenged that rejection. Meanwhile, in 1999, he and his partner settled their lawsuit with Active Media Services, for approximately $4.65 million.

“Rather than pay the IRS, Holland moved the judgment proceeds to ‘Jawbone,’ an entity he formed in the name of his four children,� according to the press release from the U.S. attorney’s office.

“Jawbone purchased a house in Kent, Conn., in which Holland and his wife lived.  Holland held himself out as the owner of the house, and explained to certain individuals that he transferred his assets to Jawbone to avoid tax liability.â€�

For the next five years, Holland continued to refuse to pay his tax debt to the IRS, according to the press release. He said he didn’t have any assets with which he could pay off his debt “and in filings, which he filed under penalties of perjury, he claimed that he had not transferred any assets of value in the previous 10 years.�

Meanwhile, he also allegedly filed false tax returns for the 2002 and 2003 tax years, claiming that  he had no income for those years “when, in fact, he earned at least $40,000 in 2002 and more than $115,000 in 2003,â€� according to the press release.

In addition to prison time, Judge Arterton ordered Holland to pay back taxes, penalties and interest in the amount of approximately $2.26 million.

A phone number for a residence in Sharon in the name of Albert Holland was disconnected. In Kent, the phone number for Holland is unlisted.