Investigation of Ponzi scheme: Leader of First Liberty fined $500K and facing potential criminal charges

A key figure in the alleged Ponzi scheme at First Liberty Building and Loan in Georgia is now facing a $500,000 fine from the state, according to an exclusive report from Channel 2 Action News. The Secretary of State’s Office issued an emergency order against Brant Frost V, accusing him of violating the Georgia Securities Act in his role with the company. Additionally, he has been referred to the Coweta County District Attorney for potential criminal charges, Secretary of State Brad Raffensperger revealed in a recent interview with Channel 2 Consumer Investigator Justin Gray.

First Liberty Building and Loan, based in Newnan, is currently under scrutiny by state and federal authorities. The Securities and Exchange Commission took action to shut down the company in June after discovering that investor funds were allegedly being diverted to fund conservative political contributions and items like luxury cars and jewelry.

The emergency order filed on Tuesday outlines that Brant Frost V was actively soliciting investments for First Liberty without the proper licensing to sell securities. He reportedly promised investors higher returns than what traditional banks could offer, all while failing to disclose his financial interests as an investor or his receipt of commission payments. As a result of these findings, he has also been referred to the state insurance commissioner for an investigation related to his insurance agent license.

Attorney Chris Huber, representing Brant Frost V, vehemently denied the accusations and criticized the Secretary of State’s Office for not allowing Frost a fair opportunity to address the claims before passing judgment and alerting the media. Huber reaffirmed that they will continue to defend Frost against these allegations.

Although only about $3.5 million has been recovered from the scheme thus far, Raffensperger, the Secretary of State, recently held a meeting with impacted investors. Many of them shared that they had been swayed to invest in First Liberty due to the company’s alleged conservative and Republican values, as represented by the Frost family.

An investigative report from the court-appointed receiver revealed that First Liberty had diverted over $1 million in investor funds to make nearly 1,000 political “donations”. This information shed light on the mismanagement of investor funds and highlighted the discrepancy between what was promised to investors versus the actual allocation of their money.

Any individuals who suspect they may have fallen victim to an investment scheme like this are urged to reach out to the Secretary of State’s Office for potential recourse. Complaints can be filed online through the Securities Division or by contacting 470-312-2640 directly.