Accused Ponzi Scheme Mastermind Swindles $140 Million from 300 Lenders Following Bankruptcy of Loan Enterprise: SEC Report
In a shocking turn of events, the U.S. Securities and Exchange Commission (SEC) has filed charges against Edwin Brant Frost IV and his company, First Liberty Building & Loan, for operating a massive Ponzi scheme. The scheme, which allegedly defrauded approximately 300 investors of at least $140 million, has sent ripples through the financial world.
The SEC's allegations detail a scheme that ran from 2014 to June 2025. During this period, First Liberty Building & Loan, under the leadership of Frost, sold promissory notes and loan participation agreements, promising returns of up to 18% by claiming that the funds would be used for short-term bridge loans to businesses at high interest rates.
However, the complaint states that while some loans were made, most defaulted. By 2021, Frost allegedly began running the business as a Ponzi scheme, using new investor capital to make principal and interest payments to existing investors. Frost is also accused of misappropriating millions for personal use, including over $2.4 million in credit card payments, $335,000 to a rare coin dealer, and $230,000 on family vacations.
Frost targeted conservative Christian investors and Republican activists, using advertisements on conservative talk radio, podcasts, and religious platforms. Initially, early investors were primarily friends and family, but since 2024, Frost broadened outreach through targeted advertising.
The SEC seeks an asset freeze and other emergency relief measures. First Liberty Building & Loan has suspended its operations and is cooperating with federal authorities. Law firms such as LKLSG and Doss Firm, LLC are investigating potential lawsuits related to the alleged Ponzi scheme.
Edwin Brant Frost IV has admitted his involvement and wrongdoing in the scheme and pledged to cooperate with investigators. Justin C. Jeffries, Associate Director of Enforcement for the SEC's Atlanta Regional Office, warns against investing in schemes promising high returns. Frost has stated that he will be cooperating with the receiver and federal authorities and asks for time to sort things out and repair the damage caused.
Meanwhile, in the world of cryptocurrency, Allnodes has launched Bare Metal Servers powered by AMD Threadripper 9000 Series, Snail, Inc. has announced its intent to explore a proprietary USD-backed stablecoin, and Vision (VSN) has been introduced as the new standard for user-centric token ecosystems. Investor Tom Lee believes Bitcoin adoption is still in its earliest days and predicts US banks will soon hold BTC as collateral. Spotlight Bitcoin Setup suggests an explosive rally is incoming, according to an analyst who called 2021's crypto top. The Sandbox has launched the largest LAND sale to date on GBM Auctions, and MultiBank Group has announced seven million MBG tokens sold out in under one hour during initial pre-sale. Swarm Network has selected Walrus to power verifiable AI on Rollup.News, and Aster has launched 24/7 Stock Perpetual Contracts Trading with exposure to US Equities. The SEC's actions against Frost and First Liberty Building & Loan serve as a stark reminder of the importance of transparency and accountability in financial dealings.
- In the world of cryptocurrency, despite the SEC's actions against a Ponzi scheme operator, there are still recent developments such as Allnodes launching Bare Metal Servers powered by AMD Threadripper 9000 Series and Swarm Network selecting Walrus to power verifiable AI on Rollup.News, indicating a dynamic and evolving landscape for investments in this field.
- The SEC's actions against Edwin Brant Frost IV and First Liberty Building & Loan highlight the importance of transparency and accountability, especially in traditional finance, where schemes promising high returns, like Frost's, can lead to major losses for investors, as seen in this case and the fraudulent defrauding of approximately 300 investors of at least $140 million.
- Meanwhile, within the realm of altcoins, projects like Vision (VSN) are being introduced as new standards for user-centric token ecosystems, demonstrating the ongoing growth and innovation taking place in the wider cryptocurrency market, amidst ongoing developments and predictions about Bitcoin adoption in the finance sector.
