East Tennessee developer Michael Ross has been indicted for wire fraud and money laundering in connection with the troubled Rarity Club on Nickajack Lake project.
The 28-count indictment, handed down in U.S. District Court in Chattanooga on Tuesday, alleges that Ross devised a scheme to defraud those who bought real estate from him and several related business entities.
The indictment said that, from December 2006 to December 2009, Ross collected money from buyers of the real estate development in Marion County, Tenn., for the construction of a clubhouse, golf course, and other amenities.
But, the indictment alleged that Ross removed the money, which he said would be put into a segregated account, for use in other real estate ventures.
Ross, the Maryville, Tenn., developer of eight Rarity resort communities across East Tennessee, has said that he tried to build and borrow too much. When the housing slump hit more than three years ago, he was left with too few sales and dollars to fulfill his development plans, he has said.
See full story in Saturday's Times Free Press.