Atlanta federal prosecutors indict two Integrity Bank officers and a developer on fraud charges
Federal authorities in Atlanta, Georgia have indicted two former officers of Integrity Bank for bank fraud, insider trading, bribery and conspiracy. A Florida real estate developer has also been indicted.
The Atlanta Journal Constitution has the story.
Integrity Bank was formed in 2000, but state regulators and the FDIC closed the Alpharetta bank in 2008. Federal prosecutors say that two of the bank’s officers, Joseph Todd Foster and Douglas Ballard, gave $80 million to a developer and then sold their stock in Integrity Bank before the failed loans surfaced. Prosecutors also allege that the two officers made large commissions and accepted payoffs from the developer. Ballard was the bank’s executive vice president and Foster was a vice president.
The real estate developer, Guy Mitchell of Florida, allegedly used the money for his own personal use including buying a private island.
The indictments come on the heels of a federal investigation which is trying to determine why 37 north Georgia banks have failed over the past two years.
Prosecutors and law enforcement believe that many of the closures were largely due to fraud and not simply a downturn in the economy.
Ballard, Foster and Mitchell will appear in federal court on Friday afternoon for their initial appearance. The crimes with which the men have been charged carry severe penalties. Bank fraud alone carries a maximum 30 year prison sentence and a possible $1,000,000 fine. Similar sentences may be imposed for bribery and securities fraud as well.
