The US Securities and Exchange Commission (SEC) has filed civil charges and has sought a freezing of emergency assets against First Liberty Building & Loan, LLC, a credit institution based in Newnan, Georgia, and the founder and owner of Edwin Brant Frost IV. The SEC claims that the company and the owner have orchestrated a Ponzi scheme that has cheated around 300 investors of at least $ 140 million for more than ten years.
Allegations against first freedom: High Returns, False Promises
According to the complaint from the SEC, from 2014 to June 2025, First Liberty and Frost Retail Investors have learned with promises of a high return of up to 18% by Promesse bank notes and loan participation agreements. Investors were told that their funds would be used to provide short -term bridging loans to companies at high interest rates, with the insurance that very few loans had been in default and that repayments of borrowers would often be made, often through Small Business Administration or other commercial loans.
However, the SEC claims that most of these loans did not perform as represented. By 2021, First Liberty used new investor funds to pay principal and interest to earlier investors, a traditional Ponzi Schemastructure. The complaint also gives a detail about the alleged embezzlement of frost of investor money for personal use, including more than $ 2.4 million in credit card payments, more than $ 335,000 spent on a rare coinquiser and $ 230,000 on family holidays. Frost is also accused of using investor money to earn more than $ 570,000 in political donations.
Regular response and assignment
The complaint of the SEC, submitted to the American court for the northern district of Georgia, accuses both first freedom and prince with the violation of antifraud provisions of federal securities laws. Five entities that are checked by Frost are also mentioned as assistance. The SEC is looking for a freezing of an emergency assets, the appointment of a recipient for the entities, permanent orders, civil fines and denial of unlawfully obtained profit with Overjures interest.
Without confirming or denying the allegations, Frost and the auxiliary resources have agreed to the emergency and permanent requests for help, where monetary remedies must be determined by the court later.
Political and community impact
Frost, a prominent figure in Republican circles in Georgia, is known for its political donations and connections. The collapse of First Liberty has sent shock waves through the conservative political network of Georgia, with many investors recruited through right -wing media and personal connections. The abrupt closure of the company at the end of June left investors and employees in Limbo, with the website of First Liberty stated that all activities had been suspended indefinitely.
Sec’s warning to investors
Justin C. Jeffries, associated director of enforcement for the Regional Office of the SEC, emphasized the recurring nature of such schemes:
“The promise of a high return on an investment is a red flag that all potential investors would have to think twice or maybe even three times before they invest their money. Unfortunately, we have previously seen this film who lure investors with promises of apparently generous returns and it does not end well.”
The SEC strengthens its focus on protecting retail investors and prosecuting Ponzi schemes and other affinity fraud, in particular those aimed at specific communities or the use of political or religious networks. Investors who believe they may have been affected are encouraged to contact the Georgia Securities Division.