Latest news with #FirstLibertyBuildingAndLoan
Yahoo
16 hours ago
- Business
- Yahoo
Georgia Republican apologizes for $140M Ponzi scheme as judge freezes assets
ATLANTA (AP) — A prominent Georgia Republican accused of running a $140 million Ponzi scheme publicly apologized on Friday as a federal judge ordered his assets frozen and appointed a receiver to try to recover cash for investors. Brant Frost IV said in a statement issued through his lawyers that he 'would like to apologize personally to those I have harmed, but I am under restrictions which prevent me from doing so.' '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.' The U.S. Securities and Exchange Commission said in a civil lawsuit filed Thursday that First Liberty Building and Loan, controlled by Frost, lied to investors about its business of making high-interest loans to companies. Instead, investigators said that its loans mostly went sour and that it then raised more money to repay earlier investors, while Frost skimmed millions for himself and his family. The firm's collapse rocked the religious and political networks that fed cash to the business, based in suburban Newnan, southwest of Atlanta. It also could have ramifications in state Republican politics, cutting off funding to the far-right candidates that Frost and his family have favored. Investigators said Frost spent $570,000 from investor funds on political contributions. U.S. District Judge Michael Brown on Friday froze Frost's personal and corporate assets, banned him from the securities business, and ordered him to pay back ill-gotten gains with interest and fines. The SEC requested the order and Frost agreed to it without admitting or denying any factual allegations. The judge also appointed financial consultant S. Gregory Hays as receiver. He will take control of assets, examine the books and try to claw back money. Everyone else is barred, for now, from suing Frost or First Liberty. The SEC said the business had only $2.67 million in cash as of May 30. With 300 investors out $140 million, that means the average investor put in nearly $500,000. Frost is alleged to have taken $17 million for himself, his family and affiliated companies, spending $573,000 on political donations to Republicans, $160,000 on jewelry, $20,800 on a Patek Philippe watch and $335,000 to buy gold coins. Frost is also accused of spending $320,000 to rent a vacation home over multiple years in Kennebunkport, Maine, the town where the family of late president George H. W. Bush spent summers. The SEC said in court papers that Frost kept writing checks and soliciting new investors even after he made 'misrepresentations' when investigators first met with Frost on May 15. Court papers included a June 16 email asking investors to put between $100,000 and $500,000 into a loan to First Liberty itself, claiming the company was developing an AI software system to help banks and credit unions complete loan applications quickly. The company went out of business 11 days later on June 27. Federal prosecutors have declined to say whether they will seek criminal charges. Sometimes, both an SEC civil case and a federal criminal case are filed over investment frauds. The business is also being investigated by the Georgia secretary of state for possible violations of securities law. First Liberty said it made loans to companies that needed cash while they waited for more conventional loans from the U.S. Small Business Administration. It charged high rates of interest — 18% on most loans, prosecutors said. First Liberty promised investors equally high rates of return — 8% to 16%. The company advertised heavily to find new investors over the past year, branching out from the original 'family and friends' approach. Frost has been an important player in Georgia politics since 1988, when he coordinated televangelist Pat Robertson's Republican presidential bid in the state. His son, Brant Frost V, is chairman of the Coweta County Republican Party and former second vice-chair of the state Republican Party. Daughter Katie Frost is the Republican chairman of the 3rd Congressional District, which includes Coweta County and other areas southwest of Atlanta.
Al Arabiya
17 hours ago
- Business
- Al Arabiya
Georgia Republican apologizes for $140m ponzi scheme as judge freezes assets
A prominent Georgia Republican accused of running a $140 million Ponzi scheme publicly apologized on Friday as a federal judge ordered his assets frozen and appointed a receiver to try to recover cash for investors. Brant Frost IV said in a statement issued through his lawyers that he would like to apologize personally to those I have harmed but I am under restrictions which prevent me from doing so. 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. The US Securities and Exchange Commission said in a civil lawsuit filed Thursday that First Liberty Building and Loan, controlled by Frost, lied to investors about its business of making high-interest loans to companies. Instead, investigators said that its loans mostly went sour and that it then raised more money to repay earlier investors while Frost skimmed millions for himself and his family. The firm's collapse rocked the religious and political networks that fed cash to the business based in suburban Newnan, southwest of Atlanta. It also could have ramifications in state Republican politics, cutting off funding to the far-right candidates that Frost and his family have favored. Investigators said Frost spent $570,000 from investor funds on political contributions. US District Judge Michael Brown on Friday froze Frost's personal and corporate assets, banned him from the securities business, and ordered him to pay back ill-gotten gains with interest and fines. The SEC requested the order, and Frost agreed to it without admitting or denying any factual allegations. The judge also appointed financial consultant S. Gregory Hays as receiver. He will take control of assets, examine the books, and try to claw back money. Everyone else is barred for now from suing Frost or First Liberty. The SEC said the business had only $2.67 million in cash as of May 30. With 300 investors out $140 million, that means the average investor put in nearly $500,000. Frost is alleged to have taken $17 million for himself, his family, and affiliated companies, spending $573,000 on political donations to Republicans, $160,000 on jewelry, $20,800 on a Patek Philippe watch, and $335,000 to buy gold coins. Frost is also accused of spending $320,000 to rent a vacation home over multiple years in Kennebunkport, Maine, the town where the family of late president George H.W. Bush spent summers. The SEC said in court papers that Frost kept writing checks and soliciting new investors even after he made misrepresentations when investigators first met with Frost on May 15. Court papers included a June 16 email asking investors to put between $100,000 and $500,000 into a loan to First Liberty itself, claiming the company was developing an AI software system to help banks and credit unions complete loan applications quickly. The company went out of business 11 days later on June 27. Federal prosecutors have declined to say whether they will seek criminal charges. Sometimes both an SEC civil case and a federal criminal case are filed over investment frauds. The business is also being investigated by the Georgia secretary of state for possible violations of securities law. First Liberty said it made loans to companies that needed cash while they waited for more conventional loans from the US Small Business Administration. It charged high rates of interest – 18 percent on most loans, prosecutors said. First Liberty promised investors equally high rates of return – 8 percent to 16 percent. The company advertised heavily to find new investors over the past year, branching out from the original family and friends approach. Frost has been an important player in Georgia politics since 1988, when he coordinated televangelist Pat Robertson's Republican presidential bid in the state. His son Brant Frost V is chairman of the Coweta County Republican Party and former second vice-chair of the state Republican Party. Daughter Katie Frost is the Republican chairman of the 3rd Congressional District, which includes Coweta County and other areas southwest of Atlanta.
Fox News
17 hours ago
- Business
- Fox News
Georgia man accused by SEC of perpetrating Ponzi scheme says he takes 'full responsibility' for his actions
The U.S. Securities and Exchange Commission filed a complaint against Edwin Brant Frost IV of Georgia and his First Liberty Building & Loan, LLC, alleging the business was operated as a Ponzi scheme. The document asserts that Frost and his company "raised at least $140 million from approximately 300 investors through the sale of loan participation agreements and promissory notes that offered annual returns of 8% to 18%. "As of 2021, approximately 80% of interest and principal payments to investors were sourced from new investor funds, and not from Bridge Loan interest payments or principal repayments," the SEC complaint claims. The SEC alleged Frost spent investor funds in various ways, some of which included making more than $570,000 in political donations, buying a $20,800 watch and making "over $2.4 million in payments to credit cards issued to him and his business entities." The Associated Press indicated that Frost is a Republican. "The promise of a high rate of return on an investment is a red flag that should make all potential investors think twice or maybe even three times before investing their money," said Justin C. Jeffries, associate director of enforcement for the SEC's Atlanta regional office, according to a press release. "Unfortunately, we've seen this movie before — bad actors luring investors with promises of seemingly over-generous returns — and it does not end well." Lawyer Joshua Mayes of Robbins Alloy Belinfante Littlefield LLC is representing Frost in the matter, and he provided Fox News Digital with a statement from Frost, who admitted he had misled people. "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. 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," Frost noted in the statement. "I would like to apologize personally to those I have harmed, but I am under restrictions which prevent me from doing so. While I do not deserve it, I am grateful for the support of friends and family as I confront this situation I created."
Associated Press
17 hours ago
- Business
- Associated Press
Georgia Republican apologizes for $140M Ponzi scheme as judge freezes assets
ATLANTA (AP) — A prominent Georgia Republican accused of running a $140 million Ponzi scheme publicly apologized on Friday as a federal judge ordered his assets frozen and appointed a receiver to try to recover cash for investors. Brant Frost IV said in a statement issued through his lawyers that he 'would like to apologize personally to those I have harmed, but I am under restrictions which prevent me from doing so.' '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.' The U.S. Securities and Exchange Commission said in a civil lawsuit filed Thursday that First Liberty Building and Loan, controlled by Frost, lied to investors about its business of making high-interest loans to companies. Instead, investigators said that its loans mostly went sour and that it then raised more money to repay earlier investors, while Frost skimmed millions for himself and his family. The firm's collapse rocked the religious and political networks that fed cash to the business, based in suburban Newnan, southwest of Atlanta. It also could have ramifications in state Republican politics, cutting off funding to the far-right candidates that Frost and his family have favored. Investigators said Frost spent $570,000 from investor funds on political contributions. U.S. District Judge Michael Brown on Friday froze Frost's personal and corporate assets, banned him from the securities business, and ordered him to pay back ill-gotten gains with interest and fines. The SEC requested the order and Frost agreed to it without admitting or denying any factual allegations. The judge also appointed financial consultant S. Gregory Hays as receiver. He will take control of assets, examine the books and try to claw back money. Everyone else is barred, for now, from suing Frost or First Liberty. The SEC said the business had only $2.67 million in cash as of May 30. With 300 investors out $140 million, that means the average investor put in nearly $500,000. Frost is alleged to have taken $17 million for himself, his family and affiliated companies, spending $573,000 on political donations to Republicans, $160,000 on jewelry, $20,800 on a Patek Philippe watch and $335,000 to buy gold coins. Frost is also accused of spending $320,000 to rent a vacation home over multiple years in Kennebunkport, Maine, the town where the family of late president George H. W. Bush spent summers. The SEC said in court papers that Frost kept writing checks and soliciting new investors even after he made 'misrepresentations' when investigators first met with Frost on May 15. Court papers included a June 16 email asking investors to put between $100,000 and $500,000 into a loan to First Liberty itself, claiming the company was developing an AI software system to help banks and credit unions complete loan applications quickly. The company went out of business 11 days later on June 27. Federal prosecutors have declined to say whether they will seek criminal charges. Sometimes, both an SEC civil case and a federal criminal case are filed over investment frauds. The business is also being investigated by the Georgia secretary of state for possible violations of securities law. First Liberty said it made loans to companies that needed cash while they waited for more conventional loans from the U.S. Small Business Administration. It charged high rates of interest — 18% on most loans, prosecutors said. First Liberty promised investors equally high rates of return — 8% to 16%. The company advertised heavily to find new investors over the past year, branching out from the original 'family and friends' approach. Frost has been an important player in Georgia politics since 1988, when he coordinated televangelist Pat Robertson's Republican presidential bid in the state. His son, Brant Frost V, is chairman of the Coweta County Republican Party and former second vice-chair of the state Republican Party. Daughter Katie Frost is the Republican chairman of the 3rd Congressional District, which includes Coweta County and other areas southwest of Atlanta.
New York Times
21 hours ago
- Business
- New York Times
S.E.C. Accuses Prominent Georgia Republican of Running Ponzi Scheme
The Securities and Exchange Commission on Thursday accused Edwin Brant Frost IV, a high-profile Republican in Georgia, of running a Ponzi scheme that defrauded 300 investors of at least $140 million. The civil complaint, filed in a federal court in Georgia, accused Mr. Frost of violating antifraud laws and misappropriating investor money via the firm he founded, First Liberty Building and Loan. It also accused Mr. Frost, 67, a donor to Republican causes and a prominent backer of the party in Georgia, of using investor funds to give more than $570,000 in political donations. It did not say to whom. In a statement shared by his lawyer, Joshua Mayes, Mr. Frost said he took 'full responsibility for my actions' and would work to repay investors. The S.E.C. said on Thursday that Mr. Frost agreed to its proposed remedies, including the freezing of assets, without admitting or denying its allegations. The complaint said that Mr. Frost told investors their money would be used for short-term 'bridge' loans for companies while they secured longer-term financing. They were promised significant returns, in some cases as high as 18 percent. Want all of The Times? Subscribe.
