Fraud Friday — SBA Bridge Financing Lender Charged in $140 Million Ponzi Scheme

May 1, 2026

Bob Coleman
Founder & Publisher

Fraud Friday — SBA Bridge Financing Lender Charged in $140 Million Ponzi Scheme

Edwin Brant Frost IV, former president of the now-defunct Georgia-based First Liberty Building & Loan, was arraigned last week on a federal charge of wire fraud for orchestrating a 20-year Ponzi scheme worth $140 million.                                                                                                               

The scheme targeted investors through Frost’s personal, political, and religious networks. 

It was a simple sell by Frost. He told investors that the bridge financing loans were only for small-business borrowers awaiting funding of their approved SBA loans from the SBA lender.

Except almost 90% of his bridge loans never received SBA funding and defaulted.

Investments were marketed to his friends as “conservative,” offering guaranteed returns of 8% to 18%. Approximately 300 investors participated, with an average investment size of $500,000. 

Frost obviously used the First Liberty Building & Loan name to evoke sentimental memories of the “It’s a Wonderful Life” movie about the ethical lender, Bailey Building & Loan, and to reinforce investor confidence.

In a classic Ponzi scheme, Frost raised new funds to pay off old investors, say the Feds. 

And, we’ve heard this story before. The Feds allege Frost diverted more than $5 million for his personal use, including:

• Over $230,000 to rent a vacation home in Maine
• Over $140,000 to purchase jewelry
• $20,800 for a Patek Philippe watch
• Over $2 million on credit card bills and
• Over $570,000 in contributions to Republican Georgia politicians 

The fund formally ceased operations in 2025. A federal judge has frozen assets and appointed a receiver to recover funds. Total investor losses are currently estimated at $6 million, though recovery prospects remain limited due to widespread defaults and dissipation of assets. 

Frost IV, 68, publicly stated last year, “I take full responsibility for my actions and resolve to spend the rest of my life trying to repay as much as I can to the many people I misled and let down.”

The Feds are skeptical. 

“Frost abused the trust of his clients, family, and friends by allegedly soliciting investors with promises of sizable returns, while knowing the money raised would instead be used for his personal expenses and to pay early investors to maintain the illusion of profits,” says U.S. Attorney Theodore S. Hertzberg. “With assistance from our law enforcement partners, we will pursue, prosecute, and punish greedy schemers who defraud victims out of their hard-earned savings and retirement accounts.”

“Frost allegedly operated a classic Ponzi scheme—using new investor funds to pay earlier investors while concealing significant financial losses,” says Marlo Graham, Special Agent in Charge of FBI Atlanta.  “Schemes like this exploit trust and can devastate victims’ savings and retirement security. The FBI remains committed to holding accountable those who engage in financial fraud and to protecting the investing public.”