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A Grass Valley woman has pleaded guilty to three counts of wire fraud in connection with bookkeeping work for three businesses, including a North San Juan natural foods company and Gary C. Tanko Well Drilling. She will be sentenced in federal court Sept. 1.
Kathryn Kinderman embezzled funds from three businesses, depositing checks from creditors into her personal bank account and paying personal bills with company funds, according to a plea bargain with the U.S. Attorney General's office.
Kinderman could not be reached for comment.
Kinderman defrauded Auburn Power Sports while she was employed there between January 2005 and January 2007, according to the plea agreement. She paid herself more than she was entitled to in compensation for her work and also took a check made out to a creditor and deposited it into her account.
Between June and August 2007, Kinderman also deposited checks made out to North San Juan business Earth Family Foods into her account, the plea agreement said. Earth Family Foods is located on Bitney Springs Road and manufactures and distributes raw, organic and kosher natural foods. No one from the company was available for comment.
The extent of Kinderman's fraud was not uncovered until 2008, after she began working for Tanko.
Auburn Power Sports went out of business in 2007 and Kinderman approached Tanko, who was looking for a bookkeeper. Auburn Power Sports had been one of his tenants, Tanko said, and had given Kinderman a strong reference.
Tanko hired Kinderman in September 2007. In February 2008, he brought in a consultant to close the books for the previous fiscal year, because the software was fairly complicated. Since there was some downtime, Kinderman went on vacation to Hawaii, Tanko said.
The consultant found “something didn't look right” and alerted general manager Anthony Segarra, office manager Dana Sartell said.
“He started digging and found two checks to PG&E that she wrote to pay her power bill,” Sartell recalled. “The amounts didn't look right — they didn't jive. He said, ‘Dana, does that look like my signature?' It looked like a copy of his signature. That's where it all started to unravel.”
Tanko said he immediately fired Kinderman when she returned from vacation.
“I confronted her right away and she confessed,” Tanko said.
At the time, she had only admitted to the two PG&E checks, which she paid back, he said.
“I asked her, ‘What were you thinking?' Tanko said. “She said, ‘Sorry, I had to do what I had to do. I needed the money.'”
Kinderman sent a letter to Tanko via attorney Stephen Munkelt in late March 2008, admitting to have stolen about $36,000.
“We started going through everything, check by check by check,” Sartell said.
Eventually, the loss was estimated at about $128,000, Tanko said. At that point, he called the Placer County Sheriff's Office. 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.
The U.S. Attorney General's office took over the case because it involved bank fraud, Tanko said.
On June 23, Kinderman pleaded guilty to three counts of wire fraud. Sentencing was set for Sept. 1 in U.S. District Court in Sacramento.
The maximum penalty is 20 years in prison, three years probation and a fine of $250,000. She will be required to pay restitution, but no amount has yet been set.
The plea deal also recommends that she be sentenced to 21 months in prison. It stipulated the total loss in the case was between $120,000 and $200,000.
All of the fraudulent deposits were made via ATM, which is why Kinderman was charged with wire fraud.
To contact Staff Writer Liz Kellar, e-mail lkellar@theunion.com or call 477-4229.
Kathryn Kinderman embezzled funds from three businesses, depositing checks from creditors into her personal bank account and paying personal bills with company funds, according to a plea bargain with the U.S. Attorney General's office.
Kinderman could not be reached for comment.
Kinderman defrauded Auburn Power Sports while she was employed there between January 2005 and January 2007, according to the plea agreement. She paid herself more than she was entitled to in compensation for her work and also took a check made out to a creditor and deposited it into her account.
Between June and August 2007, Kinderman also deposited checks made out to North San Juan business Earth Family Foods into her account, the plea agreement said. Earth Family Foods is located on Bitney Springs Road and manufactures and distributes raw, organic and kosher natural foods. No one from the company was available for comment.
The extent of Kinderman's fraud was not uncovered until 2008, after she began working for Tanko.
Auburn Power Sports went out of business in 2007 and Kinderman approached Tanko, who was looking for a bookkeeper. Auburn Power Sports had been one of his tenants, Tanko said, and had given Kinderman a strong reference.
Tanko hired Kinderman in September 2007. In February 2008, he brought in a consultant to close the books for the previous fiscal year, because the software was fairly complicated. Since there was some downtime, Kinderman went on vacation to Hawaii, Tanko said.
The consultant found “something didn't look right” and alerted general manager Anthony Segarra, office manager Dana Sartell said.
“He started digging and found two checks to PG&E that she wrote to pay her power bill,” Sartell recalled. “The amounts didn't look right — they didn't jive. He said, ‘Dana, does that look like my signature?' It looked like a copy of his signature. That's where it all started to unravel.”
Tanko said he immediately fired Kinderman when she returned from vacation.
“I confronted her right away and she confessed,” Tanko said.
At the time, she had only admitted to the two PG&E checks, which she paid back, he said.
“I asked her, ‘What were you thinking?' Tanko said. “She said, ‘Sorry, I had to do what I had to do. I needed the money.'”
Kinderman sent a letter to Tanko via attorney Stephen Munkelt in late March 2008, admitting to have stolen about $36,000.
“We started going through everything, check by check by check,” Sartell said.
Eventually, the loss was estimated at about $128,000, Tanko said. At that point, he called the Placer County Sheriff's Office. 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.
The U.S. Attorney General's office took over the case because it involved bank fraud, Tanko said.
On June 23, Kinderman pleaded guilty to three counts of wire fraud. Sentencing was set for Sept. 1 in U.S. District Court in Sacramento.
The maximum penalty is 20 years in prison, three years probation and a fine of $250,000. She will be required to pay restitution, but no amount has yet been set.
The plea deal also recommends that she be sentenced to 21 months in prison. It stipulated the total loss in the case was between $120,000 and $200,000.
All of the fraudulent deposits were made via ATM, which is why Kinderman was charged with wire fraud.
To contact Staff Writer Liz Kellar, e-mail lkellar@theunion.com or call 477-4229.
