Auburn business owner tanked by bookkeeper
Fired employee signed plea agreement in federal court
Gary Tanko thought the timing worked out well when he had an opening for a bookkeeper position and Kathryn Kinderman was able to fill it. Tanko’s bookkeeper at the time had just married and was moving out of town. Kinderman was working for one of Tanko’s tenants, whose business, Auburn Power Sports, was closing. This fall, Kinderman is expected to be sentenced to 21 months in prison for stealing more than $100,000 from Tanko as well as defrauding two other businesses, including Auburn Power Sports. And today Tanko, who owns Gary C. Tanko Well Drilling, Inc., is still trying to recover the money. “It’s something you couldn’t believe could happen,” Tanko said. Even about two days after Kinderman was hired in September 2007, she started depositing unauthorized payroll checks into her account, Tanko said. Over the next four months, she deposited checks ranging in value from $5,219.32 to $17,792.32 - most of which not made out to her - into ATM at her bank, Wells Fargo. In early 2008, Kinderman took time off for a vacation in Hawaii. Tanko said he had a separate company take over financial work during that time. That’s when someone raised a red flag. “While she was gone, our accounting firm said there was something funny with the books,” Tanko recalled. He said further investigation revealed Kinderman had paid her Pacific Gas & Electric bills with Tanko’s company money. She also forged the signature of Tanko’s general manager. Tanko said initially he didn’t know the full amount Kinderman had taken, but he immediately fired her when she returned from vacation. “She said, ‘you know, I just had to do what I had to do — I needed the money,’” Tanko recalled. “Then she just left and walked out the door.” In March 2008, Kinderman’s then-attorney Stephen Munkelt sent Tanko a letter stating that Kinderman “is taking all available steps to secure funds to reimburse Tanko Drilling.” At the time, Munkelt listed four checks totaling a little more than $36,600. Tanko said initially he was open to working out a reimbursement plan. However, when the amount taken continued to climb to about $120,000, he changed his mind. “I told them I turned it over to the sheriff,” Tanko said. “It was way too much money.” In April 2008, Kinderman was booked into Placer County Jail on charges of burglary, embezzlement over $400 and grand theft. She was later released on $10,000 bail. In July 2008, documents were filed in United States court. On Tuesday, Kinderman signed a plea agreement with the United States Attorney’s office to plead guilty to three counts of wire fraud. She will be required to pay restitution but no amount has yet been set. The agreement also recommends that she be sentenced to 21 months in prison. The maximum penalty for wire fraud includes 20 years in prison, three years of supervised release and a $250,000 fine. No fine was set for Kinderman in the agreement. In addition to taking money from Tanko, the plea states that Kinderman used her Wells Fargo account to defraud Auburn Power Sports. As their bookkeeper, “she secretly, without authority, and with intent to defraud used her power over the bank account to pay herself an amount that far exceeded what she was entitled to as compensation for her work,” the plea states. The theft from Auburn Power Sports occurred between January 2005 and August 2007. Kinderman also had access to checks written to Earth Family Foods in North San Juan and deposited a $1,194.48 check from another person to the food company into her account. On Tuesday, Kinderman’s attorney Dan Koukol declined to comment, explaining he did not think it would be appropriate to say anything until the matter was finalized. Kinderman did not return a request for comment.
The banks Tanko said today he is more frustrated with the two banks involved in the situation than Kinderman. “I don’t care what happens to her,” Tanko said. “The bank made the mistake. They should reimburse me. They messed up, not me.” A series of letters sent to Tanko from his bank, Union Bank, defer responsibility of reimbursement to Wells Fargo, Kinderman’s bank. When contacted by the Journal, a Union Bank representative said the business was unable to respond at this time. A statement provided from a Wells Fargo representative said, “Wells Fargo is cooperating with all of the parties involved.” Many of Kinderman’s deposits were made in the ATM of her bank. The money was taken from Tanko’s Union Bank account and put into Kinderman’s account. Tanko said his frustration with Union Bank — to which he had been a customer of for 36 years — has led him to switch banks to Community First Bank. “They’re supposed to watch your money and protect it,” Tanko said.
Hard times Tanko said he will continue to try to recoup his loss to maintain the business he bought out from his dad in 1964. Looking back Tanko said he should’ve questioned Kinderman’s suggestion to change their bill-paying schedule. Today, he has hired an outside company to manage his bookkeeping. He said the loss of money was “absolutely” a setback. “It’s the worst time she could’ve done it because we’re hurting,” Tanko said. “The construction business is not very good.” The Journal’s Jenifer Gee can be reached at jeniferg@goldcountrymedia.com or post a comment.
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You would think the kind of transactions she was doing would have raised a red flag or two at the banks. But what do I know, I'm just a taxpayer, like millions more out there. bailing out banks, car companies and whoever or whatever needs bailing out,
Loomisresident: I am with you there....I don't understand how we are supposed to rely on our financial institutions when they themselves can seem to fix their own problems. I know a lot of people that work for banks and they are all good people but they rely on outdated processes and systems to get us by. I was charged 37 times by one of the redbox movie rental things. I knew that I only ad about 28 bucks in that account but 1 movie was not going to hurt for just a buck. All of a sudden I am getting charges of $37.50 for each $1.00 charge because i was o/d. I called the bank and they said they would not reverse the charge because it was not their fault. I feel that they are responsible for looking after our money and being sure things like this don't happen. But the banks send the blame back to us or someone other than them. OH WELL. Over $600 later I have given up.....
Shame on Kinderman...Gary has been here in this town forever and done well here. What did you need more then him putting food on the plates of so many families... Mistakes happen and you learn from them....not repeat and see what else you can get...Think about that during your rime off.
Same thing happened 10 years ago to Wayne Drilling. Why do these selfish a_holes get away with thievery. I'm tired of this bullsh_t,
this is why we have an economic problem....send this criminal to prison and prosecute the financial institutions involved!!!!!!
I apologize it was 20 years ago, Wayne Drilling was affected.
I do books for a living and what I don't understand are business owners who don't keep an eye on their money. They turn over full responsibility to their bookkeeper, including the signing of checks and then this happens. If you own a business, you too need to be responsible. What this person did was wrong, but Gary Tanko and Auburn Power Sports have put some of the blame on themselves for not running their businesses properly.
"you know, I just had to do what I had to do"
I hope the judge uses this line when he throws her in prison.
I work with local businesses, and I am aware of another company in town that just went through the same thing. It’s amazing how many people commit embezzlement.
I beg to differ with the "bookkeeper" Cooper3737. Ms. Kinderman did not have the authority to sign checks, instead she forged them. I could understand two or three checks slipping through the cracks, so to speak, but this was many, many checks written for huge amounts and the bank should not have cashed any of them. How could Wells Fargo Bank bank repeatedly overlook a company's Payroll check(s) being deposited into someone's personal account? Especially those high dollar amounts. Shame on you Wells Fargo!