Prominent Republican donor sentenced to 15 years in prison for First Liberty Ponzi scheme, prosecutors say
A prominent Georgia Republican and Newnan businessman has been sentenced to 15 years in federal prison for a wire fraud charge connected with a massive Ponzi scheme, prosecutors say.
Edwin Brant Frost IV had pleaded guilty to one count of wire fraud in connection with a federal investigation that began after First Liberty Building and Loan, the company he led, collapsed last June.
According to officials, Frost's company said it was a lender making high-interest short-term loans to businesses, paying investors between 8 and 18 percent from the repayment of the "Bridge Loans." Instead, prosecutors say Frost stole millions of dollars for himself, using the money to rent a vacation home in Maine, buy jewelry and watches, pay off over $2 million on credit card bills, and spend over $570,000 on political contributions.
Prosecutors estimated that Frost raised at least $76 million from at least 300 investors. Among those who lost money were a company run by former Georgia GOP Chairman David Shafer, Alabama state Auditor Andrew Sorrell, and a political action committee controlled by the Republican Sorrell.
Party activists have said many grassroots Republicans lost money, while others were lured by ads on shows hosted by conservatives, including Erick Erickson, Hugh Hewitt, and the late Charlie Kirk.
In 2021, investigators say First Liberty was not generating the revenue to meet its obligations, leading to Frost lying to investors and claiming that borrowers had received pre-approval from the Small Business Administration.
"Like a false prophet and ravenous wolf in sheep's clothing, Frost used religion, politics, and promises of profitable returns to lure investors into giving him their hard-earned money. He wickedly exploited their faith to plunder their accounts and enrich himself," said U.S. Attorney Theodore S. Hertzberg. "This was a stunning, sinful, and sacrilegious abuse of trust that wrecked hundreds of investors, including retirees and seniors who lost their life savings."
On Monday, a judge sentenced Frost to 15 years in prison, followed by three years of supervised release. He was also ordered to pay more than $76 million in restitution.
Earlier this year, the Georgia Secretary of State's office announced that Bankers Life Advisory Services and Bankers Life Securities agreed to pay 46 alleged victims $6.7 million.
