Collapse of GOP-linked Georgia lender sparks state and federal scrutiny

The statement did not elaborate on the cause of the closure or which federal agency is involved and in what capacity.

But Robert Sinners, a spokesman for Georgia Secretary of State Brad Raffensperger, said the department’s securities division has opened a civil investigation. His office is encouraging the firm’s investors to contact regulators.

A U.S. Securities and Exchange Commission spokesperson said the regulator “does not comment on the existence or nonexistence of a possible investigation.” A spokesman with the U.S. Attorney’s office in Atlanta declined to comment.

First Liberty is not a bank, did not accept deposits and was not insured by the Federal Deposit Insurance Corp. First Liberty also was not chartered with nor regulated by the Georgia Department of Banking and Finance, the agency said.

The firm said on its now-defunct website it was founded in 1993 by Brant Frost IV, a fixture in Georgia’s conservative grassroots scene. His son, Brant Frost V, is a former vice-chair of the Georgia GOP and a principal at First Liberty. His daughter, Katie Frost, chairs the party’s 3rd District committee.

Several members of the Frost family didn’t return requests for comment. The company issued a statement saying it would not “make any further communications at this time regarding the ongoing situation.”

First Liberty aggressively marketed itself to conservatives, highlighting appearances on the Hugh Hewitt Show and Charlie Kirk’s podcast. It also advertised on the Erick Erickson Show.

The lender billed its leaders as “authentic followers of Christ” with a penchant for charitable giving to religious causes. Its slogan: “We say yes when the big banks say no.”

The company offered what it called “creative financing solutions” for small and mid-sized businesses seeking alternatives to traditional banks. It touted loans ranging from $250,000 to $20 million.

The company also advertised a product it called First Liberty Notes” that promised interest returns to investors of at least 8% with a minimum investment of $25,000 and up to 13% for investment of at least $250,000.

The First Liberty Notes were available to “accredited investors,” those with high net worths. The company said it lent the proceeds to borrowers seeking short-term or bridge financing.

“Participating in a First Liberty Note is a smart decision for those looking to support local small businesses, while growing their money at a higher rate than the big banks can offer,” the company’s website said, according to an archived version reviewed by The Atlanta Journal-Constitution.

The website included endorsements of First Liberty’s business, including one purported to be from former state Insurance Commissioner Ralph Hudgens.

“Suzanne and I have known Brant Frost and his family for over 30 years. We have participated in many bridge loans with First Liberty, and have always been pleased with the results. We hope to do business with them for many years to come,” Hudgens is quoted as saying on the website. Hudgens couldn’t immediately be reached for comment.

On the conservative “John Fredericks Show” in June 2024, Brant Frost V framed First Liberty’s mission as part of a broader effort to fuel what he called “patriot economy.”

“One of the great pleasures and honors in our business is to be able to help patriots across the country,” he said. “We’ve got retired teachers, we’ve got retired businessmen, we’ve got retired ministers who have been part of this program — as well as doctors, lawyers and everyone else you can imagine.”

Frost pitched First Liberty’s investment offerings as a way to deliver “Wall Street returns for Main Street investors,” adding: “This is how we grow the patriot economy.”

From their base in Coweta County, the Frost family carved out a high-profile — and often controversial — role in pushing the Georgia Republican Party further to the right.

Brant Frost V, known as “Five” to friends, was elected chair of the Coweta County GOP in 2013 and second vice-chair of the Georgia GOP in 2018.

He was reprimanded by the state GOP’s executive committee in 2020 after saying that demonstrators kneeling to protest racial injustice are turning the U.S. into the “land of the weak and the home of the slave.”

Katie Frost, a political consultant, was the youngest female delegate from Georgia to the 2016 Republican National Convention and played an influential role at last month’s Georgia GOP convention.

More recently, the siblings joined dozens of other activists who signed a resignation letter leaving the ultraconservative Georgia Republican Assembly, citing growing disagreements with the organization’s strategy.

Their political style earned both allies and critics.

David Cross, a conservative activist who ran unsuccessfully for Georgia GOP chair this year , publicly called the Frosts “a cancer on the Georgia Republican Party” at GOP events this year.

He told the AJC he had raised concerns about the company with state regulators. Others, including former Georgia GOP vice chair Brian Pritchard, called for a “full financial investigation” of the state party.

Georgia GOP chair Josh McKoon said the party has no investments with First Liberty.

Editor’s note: A previous version of this story incorrectly characterized David Cross’ campaign for Georgia GOP chair. Cross ran unsuccessfully for the position this year. This story has been corrected.