Federal authorities have accused Edwin Brant Frost IV, a Georgia conservative activist, of orchestrating a $140 million Ponzi scheme through First Liberty Building and Loan. The SEC alleges Frost used investor funds not only for business loans but also for luxury spending. Records show $335,000 spent on rare coins, $230,000 on family vacations, and $160,000 on jewelry. Frost and his family also spent over $570,000 on political donations and $2.4 million using credit cards.
Promises of High Returns and Patriot Economy Investment
First Liberty promised investors up to 18% returns through bridge loans to small businesses. Edwin Brant Frost V, Frost’s son and a state GOP official, promoted the investments as a way to “grow the patriot economy.” Conservative media personalities like Erick Erickson and Hugh Hewitt endorsed the Frosts, praising their Christian values and business ethics.
Investor Trust Rooted in Shared Beliefs
Investors such as John Vander Wiele and retiree Joe Hubbard said their trust stemmed from the Frost family’s public faith and conservative alignment. Vander Wiele noted that meeting the Frosts felt “like lending money to your neighbor.” Hubbard and his wife put their life savings into First Liberty, now fearing they may never recover it. Their distress underscores the emotional and financial toll.
Federal Investigation Reveals Classic Ponzi Tactics
According to the SEC, First Liberty used new investor money to pay earlier investors, while falsely claiming defaults were rare. Many small businesses that borrowed through First Liberty struggled to repay loans, which they failed to disclose to investors. SEC Associate Director Justin C. Jeffries emphasized that promises of excessive returns were clear warning signs.
Court Freezes Assets; Frost Agrees to Financial Penalties
A federal court froze Frost family assets and ordered restitution. Frost agreed to the financial terms but did not admit guilt. He issued a public apology, expressing regret while stating legal restrictions prevented direct communication with victims. Prosecutors have not yet announced potential criminal charges. Meanwhile, Georgia state authorities are also investigating the case.
Conservative Networks and Political Fallout
The scheme’s collapse has unsettled Georgia’s conservative Christian community. First Liberty had donated to several Republican campaigns and PACs. Frost’s political history includes roles with Pat Robertson, Pat Buchanan, and Alan Keyes, contributing to his reputation as a committed conservative activist.
Source:
‘Georgia’s George Bailey’ Accused of $140 Million Fraud
Photo by Dan Meyers on Unsplash
About Post Author
