No liquid assets?
The fraud fun doesn't stop!
Steven Ingersoll, the man who previously secret documents reveal spent years manipulating financial statements at the Grand Traverse Academy in an effort to cover up his multi-million dollar, taxpayer-fueled ‘loot-a-thon’, responded yesterday to the government's demand that he provide an accurate presentence listing of his assets and liabilities.
The government’s June 19 motion asked the court to order Ingersoll to provide "complete and accurate financial information" to his probation officer no later than July 20, 2015, and to sanction Ingersoll if he failed to comply.
In its motion, the government asserted "the most egregious manifestation of Ingersoll’s refusal to provide necessary information to his probation officer is in the listing of assets and liabilities that Ingersoll gave to his probation officer through his defense counsel."
The government claimed Ingersoll "grossly understated the value of his assets, double counted his potentially legitimate liabilities, and claimed liabilities that are not actually his obligation to pay."
|Duke Wayne Suite, 1725 Carlisle Farms Drive ("The Carlisle House")|
Geht says his client provided a financial summary to the probation officer listing his assets. To avoid being accused of providing inaccurate valuation information, Geht claims Ingersoll “disclosed next to each real estate asset that the value being provided is “SEV”. Lest there be any doubt about what was meant by SEV, the note to the Financial Statements stated “Real estate values are stated as the state equalized value, which is the taxable value of the property as determined by the county tax assessor.
The values are not admissions of actual value and are included for reference only. Actual value of real estate can only be determined with an appraisal or in an arms-length sale.”
Geht, a CPA and tax attorney, states the “probation officer was free to leave that value in his analysis, to simply double that value (as is a common practice), or to obtain an independent appraisal.”
The government’s motion revealed Ingersoll reported his home in Traverse City, Michigan as an asset with a value of $162,830 but also reported a liability of $384,000 from the mortgage on that residence.
Ingersoll reported that his second home in Bay City is worth less than $88,000 but also listed a $103,000 mortgage on that home as a liability.
In its June 19 motion, the government said "Ingersoll’s information of that nature does not withstand scrutiny. If one charitably indulges a theory that Ingersoll may have reported — not the value of his assets, but the equity he is willing to acknowledge in those assets after deducting encumbrances such as mortgages and taxes — then it is apparent that Ingersoll also has double counted the encumbrances by listing them as liabilities."
In addition, the prosecution motion stated Ingersoll claimed to his probation officer to have liabilities associated with at least four parcels of Bay City real estate that do not appear to be included in his list of assets.
In the July 6 defense response, Geht stated the “government then proceeded to complain about the exclusion of other assets. While the government asserts that Dr. Ingersoll failed to value his optometrist-related assets or the value of the intellectual property, the government provides no information for why it believes the value of either is greater than zero.”
Why not ask the Grand Traverse Academy why Ingersoll was reportedly paid $300,000 annually for his "curriculum development" Integrated Visual Learning-based “intellectual property” if it’s truly worth zero?
And ask them if he’s still receiving that money?
Or how about asking Ingersoll’s insurance carrier how much they paid out a few years back after Ingersoll’s IVL/optometric-related equipment was destroyed in a ‘flooded basement’ at the Bay City Academy?
Geht also asks the government to identify what other “real estate interests outside of Bay City other than his primary residence in Traverse City” were omitted by Ingersoll.
Now that I’d like to know, too!
In its June 19 motion, the government claimed Ingersoll listed liabilities that “were not truly his, apparently seeking to magnify his indebtedness.”
As an example, the government stated “Ingersoll included on his list of liabilities the property taxes and a $1.6 million-plus mortgage on the Bay City Academy building at 400 North Madison in Bay City. Ingersoll and his wife quit claimed any interest in that property in a deed dated April 9, 2010 and recorded on January 26, 2011.”
Ingersoll also reported that he is personally liable for the property taxes and a $759,974 mortgage on the Farragut School in Bay City, and even a $700,000 State Aid Note for the Bay City Academy.
Since when has he paid any property taxes?
Geht responds to the government’s claim that Ingersoll has “overstated his liabilities”, saying the complaint is suprising, “given that the government acknowledges Dr. Ingersoll personally guaranteed those liabilities.” (Unlike the so-called management fee “repayment plan” at the Grand Traverse Academy, which was never immortalized in writing.)
In its June 19 motion, the government asserted “all of those liabilities claimed by Ingersoll are actually obligations that are to be paid out of state per pupil funding provided to the Bay City Academy by the taxpayers of Michigan”.
Geht counters, claiming that with the “precarious state of the Bay City Academy in the wake of Dr. Ingersoll’s conviction”, it’s not surprising that Ingersoll “expects to be liable under those guarantees.”
(The entity that currently operates the Bay City Academy, boy wonder Brian Lynch's Mitten Educational Management, not Ingersoll, is legally responsible for directing the state per pupil funds to pay the mortgage and property taxes owed in connection with that public school academy.)
According to the government, Ingersoll reported to his probation officer that his liabilities exceed his assets by almost $3.6 million dollars. At the same time, Ingersoll has refused to give information regarding his income and his necessary living expenses to the probation officer.
Here’s how Geht counters that one — with Ingersoll’s “liquidity problems.”
Yeah, don’t cry for me, Argentina!
Geht says Ingersoll “did not provide an income statement to the probation officer because a preparation of an accurate income statement (to avoid the accusations of obstruction of justice) would require services of a professional accountant. Dr. Ingersoll has no liquid assets with which to pay such an accountant and the government is seeking to block Dr. Ingersoll from selling his assets to solve his liquidity problems.”
Even that little red Mercedes Benz convertible (it looks to Miss Fortune like a 380 SL) concealed in the garage at Ingersoll's 1514 Center Avenue Bay City home? Or the other Mercedes tucked under the portico behind the Perry House at 2230 Center Avenue?
Wonder if the government knows about them?
Whoops, I guess they do now!
Geht claims Ingersoll expressly stated in his financial disclosure statement that to “the extent the Probation Officer requires clarification or additional information, or would like to see supporting documentation related to this or any other submission” Ingersoll reiterated his “intent to provide full disclosure and will gladly supplement as required.”
Geht asserts Ingersoll’s probation officer never made a request.
While Geht states Ingersoll “understands the probation officer’s need for this information”, and would “sign any authorization for release of financial information requested by the probation officer for any period of time desired by the probation officer.”
In its June 19 motion, the government suggested that the court order should require Ingersoll to provide documentation of his current household income and expenses, including records that would enable Ingersoll’s probation officer to verify the amount, source and manner of receipt of all income in Ingersoll’s household, along with proof of payment of all expenses Ingersoll claims are incurred in his household.
In addition, the government motion stated Ingersoll should also be required to provide a letter to all of his creditors, directing each creditor to submit directly to the probation officer all available documentation to support the financial information Ingersoll has or will provide, including loan applications, appraisals, and loan payoff amounts for all claimed liabilities. The order should also require Ingersoll to “cause the entities holding Ingersoll’s financial accounts (such as Ingersoll’s bank, credit union, credit card, brokerage, and retirement accounts) to release directly to his probation officer all account statements for the period between January 1, 2013 and July 1, 2015, to enable the probation officer to better understand Ingersoll’s financial situation in the year before Ingersoll was indicted to the present.”
In conclusion, Geht says Ingersoll “does not have the funds with which to obtain all of the financial information demanded by the government, but has always been willing to sign any release for any information desired by the probation officer.”
I wonder if Ingersoll's including that $1.7 million dollars he still owes the Grand Traverse Academy in his "liabilities"?
Those folks were