A federal judge in Atlanta unsealed an indictment Friday charging two former executives at Integrity Bank and a hotel developer with fraud tied to more than $80 million in loans from the Atlanta-area bank, which was seized in August 2008.

The indictment charges Douglas Ballard and Joseph Todd Foster, two former vice presidents at Integrity Bank, and Guy Mitchell, a hotel developer in Coral Gables, Florida, with "various acts of conspiracy, bribery, bank fraud and/or securities fraud," the U.S. Attorney's Office for the Northern District of Georgia stated in a news release.

The small Georgia bank was seized by banking regulators after lending much or all of its capital to Mitchell, owner of the Casa Madrona Hotel & Spa in Sausalito, California. Integrity Bank opened in Alpharetta, Georgia in 2000.

According to the indictment, Mitchell, 50, and companies he controlled allegedly obtained more than $80 million in supposed business loans from Integrity Bank between 2004 and 2007.

Prosecutors allege Mitchell obtained much of the money under false pretenses and deposited nearly $20 million in a personal checking account, much of which he withdrew for personal use. Among his personal expenses was more than $1.5 million spent on a private island in the Bahamas, according to prosecutors.

The indictment alleges Mitchell paid Ballard, 40, more than $230,000 in bribes over a nine-month period. It also alleges Ballard and Foster, 42, committed securities fraud through insider trading by selling nearly all of their shares in Integrity Bank while secretly aware of "substantial problems" with Mitchell's loans.

Prosecutors allege Mitchell paid little, if any, of the money back to Integrity Bank to satisfy interest payments. Instead, they allege the hotel developer paid interest on existing loans through disbursements from other loans with the help of bank executives. Mitchell continually borrowed more and more money to keep paying the ever-increasing interest payments, according to the indictment.

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