SEC Accuses Georgia Lender of Running $140 Million Ponzi Scheme

A $140 million Ponzi scheme run by a Georgia-based lending firm and its founder defrauded around 300 investors, offering promissory notes and loan participation agreements with returns of up to 18%, the SEC said.

Edwin Brant Frost IV and his company First Liberty Building & Loan LLC misrepresented to investors for over a decade that their funds would be used for short-term bridge loans to businesses at high interest rates, the Securities and Exchange Commission alleged in a complaint filed Thursday in the US District Court for the Northern District of Georgia.

Instead, he pocketed millions to pay his credit ...