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Thursday, June 1, 2017

RISKY BUSINESS: Grand Traverse Academy Board, Then Headed By Mark Noss, Conspired In 2013 With Steve Ingersoll To Cover Up Financial Red Flags Raised By Auditor. Ingersoll, Noss Conspire Behind-The-Scenes! Board Concealed $1.8 Million Dollar Loss & Made It Look Like A Payment!

In the first quarter of the fiscal year ending June 30, 2013 (July-September 2012), Steven Ingersoll transferred $1,735,000 from Smart Schools Management, Inc. to the Grand Traverse Academy ostensibly to repay a portion of his multi-million dollar accounts receivable debt.

However, during that same time period, Ingersoll transferred $1,860,000 back to Smart Schools from the Grand Traverse Academy, effectively stealing another $125,000 from the charter school.

When auditors from the accounting firm Dennis, Gartland & Niergarth noted in the Grand Traverse Academy's June 30, 2013 financial audit that Ingersoll had withheld repayment of his overpaid fees, Ingersoll masterminded a scheme (aided and abetted by board president Mark Noss, superintendent Kaye Mentley and the entire board of directors) that pushed against on the auditor's shocking findings — actions that ultimately led to a complaint I filed on March 31, 2017 with the Michigan Department of Education and the office of Michigan's Attorney General, Bill Schuette.

An investigation of the Grand Traverse Academy board's decision to accept forged bank statements purporting to show Ingersoll had repaid $1,813,330 (later invalidated by federal investigators in October 2015 during Ingersoll's sentencing hearing), its debt write- off process and decision not to seek repayment of money that may have been misappropriated by Ingersoll between 2007-2013 is currently underway.

In the days leading up to Steven Ingersoll's November 24, 2013 email to Mark Noss (shown above), ordering him to use the forged bank statements he'd created to “give them comfort that those transfers did indeed occur”, there was a furious, behind-the-scenes effort to execute a plan that would, in the words of Mark Noss, provide “Steve with a solid case”.

As Ingersoll himself warned Noss and Mentley: “Hanging me out with unrefuted false implications will not end well for anyone.”


The emails reproduced below were entered into evidence during Steven Ingersoll's sentencing hearing, and reveal a concerted effort among Mark Noss, former superintendent Kaye Mentley and Ingersoll to counteract the findings by Dennis, Gartland & Niergarth in the Grand Traverse Academy's June 30, 2013 audit that Ingersoll had abused his access to public funds and withheld repayment of nearly $2.0 million he owed to the school.

November 14, 2013 10:52 AM 
From: Mark Noss 
To: Steve Ingersoll 
Please arrange with Kaye to put the Dec 6 board meeting back on the schedule. I asked Brad to run the meeting. 

November 14, 2013 11:43 AM 
To: Steve Ingersoll 
From: Kaye Mentley Cc: Mark Noss 
Subject: Re: FW: board meeting 
Steve and Mark: I would like to talk further about this and if the board is going to be asked to pass a resolution, it should be based on advice from Doug and/or Nick Oshelski. I am uncomfortable wit the position that this place the board in. We are already choosing to not go forward with several of the auditor’s recommendations in order to help Steve. 

November 14, 2013, at 2:06pm 

From: Steven Ingersoll  
To: Kaye Mentley

While you may be uncomfortable, I assure you, I am more uncomfortable with the auditor’s false information delivered to the board, government and general public. 

I held back as getting the audit filed timely was critical to the Academy. 

I am now compelled to set the record straight. The board can make its own decision once the facts are before them. 

The auditor made false claims at the board table and in finding number 4. I wrote my response in a fashion that allowed the board to proceed timely. 

I now intend to present factual proof that refutes the false statements made by the auditor. 

The board can decide what to do with that information. 
Of course, I hope it will help me. 

Your comment/implication that “we” meaning the board has already done enough to “help Steve” is not well received. It is sometimes difficult for me to appreciate your point of view. 

Do you see yourself as the board’s representative, the school or some other non-defined holder of authority beyond contractual definition? 

Let’s get straight what hat you wear and what role you play. I need not be explicit here. We are all quite familiar with the contract circumstances. 

We have all agreed the best outcome is one of cooperation, so cooperate! 

Hanging me out with unrefuted false implications will not end well for anyone. 

Nick and Bruce have already made clear their support; Doug, Meg Hackett and DGN the opposite. Do you really think it best to revisit the hardened opinions of the participants again? The auditor has made serious implications based on false claims. 

They verbally denied that cash flowed from SSM to GTA in the first quarter of FY 13 to service the A/R balance. 

Note 4 states that SSM withheld payment of that A/R balance. 

These statements are false. 

I stated they were false, they repeatedly contradicted my statement of fact. 

Further, they implied that timing and authorization of budgeted fee draws was somehow untoward when there is no legal basis for such a position. 

In fact, State law and the management contract both specifically empower the CAO and SSM, respectively to determine the timing and execution of the board approved budget. 

That is precisely what was done. 

Neither Doug Bishop or DGN has authority to dictate the parameters of articulation between GTA and SSM. We have a contract, it is explicit on these matters. Doug, DGN and you have pressed for substantial extra-contractual constraint that I have been quite reasonable in accepting. 

You are now pressing too far. 

I do not intend to let stand the false implications contained in the audit or the auditor’s public statements. 

It was apparent that the board was quite uncomfortable with the language the auditor selected in their 11th hour revision. It was abundantly clear that they added aggressive language to protect themselves at my expense. 

A board member has asked that the regular meeting be held as he thinks this topic should be reviewed and settled. 

If the board wishes to seek counsel beyond their own deliberation it is their call, not yours. 

Please take the necessary steps to prepare for the regularly scheduled December 6th board meeting. 

November 14, 2013, at 6:42PM

Kaye Mentley responded:
Thank you for sharing your thoughts, I will do the same, and although it seems weird to have Mark copied on this, if that is what you want it is fine with me. 

It seems unusual that we talked several times about whether or not to have the board meeting, decided to cancel it especially knowing that Mark was out of town, and are now scheduling it again. 

I don’t disagree at all with you presenting more factual information to the board, just questioning the order of events and timing so that “we” don’t look cludgy to board by first canceling and then canceling the cancellation. In this sense the “we” means you me and Mark. 

I probably do use “we” too often, but it is also an accurate pronoun for how I feel and how I try to operate. I think that I am a we with the Board, I am a we with SSM and with you, I am a we with the GTA staff. I don’t see myself as anyone’s representative or any “non defined holder of authority”, I have always worked in an inclusive fashion and found it most successful. 

I am sorry that you chose to see my thoughts as “uncooperative”, my thoughts and opinions haven’t changed since I met with you or since the Board meeting, or since my call to Mark saying that I didn’t think the Board should ask SSM to detail its services in order to establish a fair market value. 

That isn’t what I meant by my statement that the board is helping Steve out. 

I think the Board has done a good job of reversing their previous decision of full management fee going to prepaid and accepting management’s response to the audit. I think it takes some courage for a board to go against an auditor’s recommendation. 

Your voice mail indicated that you would be asking the Board to act on a resolution and that seems to bring everything up again. 

My opinion remains that the faster and easier we put this whole thing behind us the better, and I thought that it was pretty well laid to rest after the board meeting. And it is a we and it is an us! 

I think that it greatly benefits the school and the board to have LSSU in our corner. They are proud of GTA’s achievement and culture, and want to do everything possible to continue the school’s success. It seems prudent to keep LSSU well informed, and Doug has been the conduit for most of keeping them up to date. 

If the Board is going to be presented with a resolution, it seems like it would help the situation if LSSU knew and was supportive of that action. As always and as I told you during our conversation, I do not contact individual board members to discuss things, and I would not contact Doug or request LSSU attend the meeting without the board’s agreement. 

That is why I asked Mark about it, and included you so that we could share each other’s thinking. — I want you to be protected, I want the Board to be comfortable and confident, I want GTA to continue to get better and I want to continue to be a “we” with all with whom I work. 


P.S. I will work with Heidi on announcing the meeting and I will look for a location. We may need to be offsite since we have so many school activities that afternoon. 

November 15, 2013 9:44 AM 
From: Steven Ingersoll 
To: Kaye Mentley 
Cc: Mark Noss 
Subject: Re: board meeting 

I have revisited this topic, your comments and mine. I appreciate your comments once again. 

I am sorry to be so acutely reactive. 

I know by this time “Steve problem fatigue” abounds and we all want it to end. 

I am working on a strategy to make it end. Addressing the audit language is an important subset of that time sensitive strategy. 

While I may be overly optimistic it is nice to actually see a path to concluding this difficult period. 

I recognize the egocentric nature of my action plan and that it must be carefully tempered to indemnify all people and entities from risk. 

Thus your appropriate request for discussion. 

I will review with you both my presentation of facts for the board’s consideration prior to presentation. I think the board should first consider the facts prior to deciding if they need counsel prior to response. 

I will not ask the board to go out on a limb, just acknowledge facts.

Sunday, November 17, 2013 12:50 PM 
From: Mark Noss 
To: Steve Ingersoll; Kaye Mentley 
Subject: RE: Board Meeting 

Steve, and Kaye, 

Well, I guess it is time for a response from me. The irony of this situation is that we are all wanting the same things but one would think we are in opposing camps. And I also use WE very strongly because it is up to the three of us and our strategies to get through this and find a resolution. 

At our last board meeting we unanimously passed the audit and its language, as well as the management response. Steve, every member of that board totally supports you and feels this has been put to rest. So you realize the only reason to revisit this is for your benefit. I feel through your response to the audit, accepted by the board, you have a solid case. 

Obviously you do not. You make reference to Mary “verbally denying” that cash had flowed from SSM to GTA in the first quarter of 2013. [NOTE: Mary Krantz, CPA with auditor Dennis, Garland & Niergarth] Regardless, the exchange is not in the minutes. The audit referenced the timing of the draws, which as you point out was within your ability to do. The board agreed that the language “abuse of funds” was harsh but again acknowledged and accepted your response. These are things that can be brought to the board in discussion without having to pass a resolution. So I am unclear exactly how this resolution would read, if in fact we need one, but I would like to discuss it with Nick prior to the board meeting. 

Our most sensitive area in providing Steve with a solid case moving forward is that it cannot put the board at risk. We are being closely scrutinized by the IRS, the auditors and how have had to share those views with our authorizing agent and the State (fortunately not the RE or the public as of yet). I feel the board has a fiduciary responsibility to listen to the auditors. Doug has been adamant about this as well and I am sure LSSU and the State are in agreement. He is our counsel and he is being paid to protect us and inform us of the risks. The auditors have made recommendations to bid our management fee and then clearly spell out services that we are receiving for the fee that we pay. Doug has made acutely clear, multiple times in correspondence, the importance of this from a board fiduciary standpoint, I shared with him that we had done a market analysis of management fees and feel we are in the ballpark. He has since stressed the importance of documentation of our analysis including specific fees reviewed along with the services to justify our decision. Steve, I realize we are in a contractual agreement with SSM presently but it has been made abundantly clear the contract is inadequate. I understand we don’t want to rewrite the contract but I want to take action that provides some protection for the board. In reviewing the auditor’s language, they state “We recommend the academy consider bidding out those contracts every three to five years”. Intending to to this at the end of our current contract may put us in a safe position. What is your feeling on this, Kaye? 

Just so you know, emails are about the worst way to communicate sensitive issues. I am happy to meet any time I am available or call me to discuss these items further. Thanks to both of you for all you are doing. 



  1. What is the future of GTA? How will that school continue to open its doors to students and staff without any money or an honest board of directors?

  2. How does the GTA fraud stop? Enroll your student's in another school. One year without student's and this whole fraud is over.