Branch Manager Fined, Barred From Renewing License as Part of Kickback Scheme

The Minnesota Department of Commerce has banned a collection agency branch manager from obtaining a license for five years and fined him $2,500 for orchestrating a kickback scheme in which he inflated the commissions of a collector in order to share in the windfall. The collector was previously fined $15,000, $10,000 of which was suspended.

Copies of the consent orders against the branch manager and the collector can be accessed by clicking here (branch manager) and here (collector).

The collector was fired from the agency in 2018. When he was terminated, he requested an exit interview. During the interview, he reported that for a 10-month period in 2014 and 2015, the branch manager, Tanner Lee Kabat, manipulated the agency’s payroll systems to boost his commissions by up to $3,000 per month. Kabat asked for $500 of that as a kickback for organizing the scheme. An audit uncovered that the collector was overpaid by at least $8,000 and that Kabat diverted more than $18,000 in unpaid commissions to three different collectors.

When confronted, Kabat initially claimed the commissions were incorrectly paid, but was unable to provide a legitimate basis for the overpayments or disprove the collector’s allegations. Kabat was subsequently fired by the agency.

The collector, Christopher Neuman Baldwin, admitted in 2019 to receiving $18,563 in ill-gotten commissions. Along with paying the $5,000 fine, Baldwin also agreed to cease and desist from violating any laws, rules, or orders entrusted to the Commissioner of the Minnesota Department of Commerce.

Kabat had been licensed by the state as a debt collector since 2008. While the agency was based in Minnesota, he managed an office that was located in Wisconsin.

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