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Yahoo
12-07-2025
- Business
- Yahoo
Officials probing Georgia GOP donor accused of $140 million Ponzi scheme
The Securities and Exchange Commission and Georgia officials are investigating a Georgia businessman and GOP supporter accused of perpetrating a Ponzi scheme defrauding hundreds of investors out of more than $140 million, and using some of the money for political donations. Authorities have accused Georgia-based Liberty Building & Loan and its owner Edwin Brand Frost IV of defrauding more than 300 investors. According to a complaint filed by the SEC, Frost "misappropriated a significant amount" of the company's investor assets, including $570,000 in investor funds used to make political donations. MORE: How far would a wife go to keep $2M Ponzi scheme a secret? The complaint also said $335,000 in investor funds was paid to a rare coin dealer, $230,000 was used to rent a vacation home in Kennebunkport, Maine, $140,000 was used to purchase jewelry and $20,800 was used to purchase a Patek Philippe watch. "Given that First Liberty was operating at a loss, Frost was not entitled to these funds according to what he told investors as to how he would be compensated," the civil complaint, filed in Georgia on Thursday, said. According to the complaint, Frost and his companies in part told investors their funds would be used to make short-term small business loans, and that they would receive large returns. "Beginning no later than 2021, First Liberty began operating as a Ponzi scheme," the complaint alleged. The complaint alleged the company started soliciting funds first from "friends and family," but last year "started a more widespread public solicitation of potential advisors," advertising on radio and podcasts. According to the complaint, "Most, if not all, of the funds raised through the publicly advertised offering were either misappropriated or used to make Ponzi-style payments to existing investors." Frost, in a statement provided by his attorney, said he takes complete responsibility and is working to pay back investors. "I take full responsibility for my actions and am resolved to spend the rest of my life trying to repay as much as I can to the many people I misled and let down," Frost said in the statement. "I will be cooperating with the receiver and federal authorities and ask that everyone allow the receiver time to sort things out and do his best to repair the damage I created. I would like to apologize personally to those I have harmed." A message on the company's website said it had "ceased all business operations" and is "cooperating with federal authorities as part of an effort to accomplish an orderly wind-up of the business." Georgia Secretary of State Brad Raffensperger said in a statement that his office has an "active and ongoing investigation" and encouraged any potential victims to come forward "immediately." MORE: Bernie Madoff's victims to receive final payout totaling $131 million An FBI official told ABC News, "The FBI is aware of the allegations. However, the FBI does not comment upon the existence or the nonexistence of any investigation. Anyone who believes they have information about the matter can file a complaint at On Friday, a judge in Georgia entered an order freezing the defendants' assets, among other measures. The SEC said the defendants had consented to the move "without admitting or denying the allegations in the complaint." ABC News' Luke Barr contributed to this report.
12-07-2025
- Business
Officials probing Georgia GOP donor accused of $140 million Ponzi scheme
The Securities and Exchange Commission and Georgia officials are investigating a Georgia businessman and GOP supporter accused of perpetrating a Ponzi scheme defrauding hundreds of investors out of more than $140 million, and using some of the money for political donations. Authorities have accused Georgia-based Liberty Building & Loan and its owner Edwin Brand Frost IV of defrauding more than 300 investors. According to a complaint filed by the SEC, Frost "misappropriated a significant amount" of the company's investor assets, including $570,000 in investor funds used to make political donations. The complaint also said $335,000 in investor funds was paid to a rare coin dealer, $230,000 was used to rent a vacation home in Kennebunkport, Maine, $140,000 was used to purchase jewelry and $20,800 was used to purchase a Patek Philippe watch. "Given that First Liberty was operating at a loss, Frost was not entitled to these funds according to what he told investors as to how he would be compensated," the civil complaint, filed in Georgia on Thursday, said. According to the complaint, Frost and his companies in part told investors their funds would be used to make short-term small business loans, and that they would receive large returns. "Beginning no later than 2021, First Liberty began operating as a Ponzi scheme," the complaint alleged. The complaint alleged the company started soliciting funds first from "friends and family," but last year "started a more widespread public solicitation of potential advisors," advertising on radio and podcasts. According to the complaint, "Most, if not all, of the funds raised through the publicly advertised offering were either misappropriated or used to make Ponzi-style payments to existing investors." Frost, in a statement provided by his attorney, said he takes complete responsibility and is working to pay back investors. "I take full responsibility for my actions and am resolved to spend the rest of my life trying to repay as much as I can to the many people I misled and let down," Frost said in the statement. "I will be cooperating with the receiver and federal authorities and ask that everyone allow the receiver time to sort things out and do his best to repair the damage I created. I would like to apologize personally to those I have harmed." A message on the company's website said it had "ceased all business operations" and is "cooperating with federal authorities as part of an effort to accomplish an orderly wind-up of the business." Georgia Secretary of State Brad Raffensperger said in a statement that his office has an "active and ongoing investigation" and encouraged any potential victims to come forward "immediately." An FBI official told ABC News, "The FBI is aware of the allegations. However, the FBI does not comment upon the existence or the nonexistence of any investigation. Anyone who believes they have information about the matter can file a complaint at On Friday, a judge in Georgia entered an order freezing the defendants' assets, among other measures. The SEC said the defendants had consented to the move "without admitting or denying the allegations in the complaint."
