Alabama Investigates Political Contributions Linked to Ponzi Scheme

Alabama officials are now looking into the state’s political contributions in relation to a significant Ponzi scheme originating in Georgia, which has garnered attention from federal regulators.

The Alabama Securities Commission (ASC) revealed on Monday that it has initiated an investigation into First Liberty Building & Loan LLC and its founder, Edwin Brant Frost IV. The U.S. Securities and Exchange Commission (SEC) has accused Frost of defrauding a considerable number of investors over several years.

On the same day, Alabama Secretary of State Wes Allen urged political candidates and committees in Alabama to return any donations received from Frost or his businesses to the respective court-appointed recipients involved in the federal case.

Allen emphasized the seriousness of allegations surrounding financial fraud, particularly when it intertwines with campaign financing, stating that law enforcement agencies must ensure that victims are fully supported.

While the Secretary of State’s office monitors campaign finance reports in Alabama, it lacks the authority to investigate or prosecute fraud, and cannot mandate the return of contributions.

The ASC, responsible for regulating investment activities in the state, confirmed that it is collecting information due to multiple inquiries regarding this matter.

They mentioned being in communication with Alabama and Georgia authorities and are gearing up to start a formal investigation to protect the interests of Alabama’s investors.

A public comment at this stage, they noted, is not appropriate.

Frost is associated with the Georgia Republican Party and is accused of raising over $140 million from investors between 2014 and 2025, misappropriating at least $5 million for personal use, and contributing approximately $570,000 to political campaigns.

The SEC’s formal complaint against Frost was filed in the Northern District of Georgia on July 10, alleging that he had run his business akin to a Ponzi scheme since 2021.

Campaign finance records indicate that more than $132,000 has been directed to Alabama political candidates and political action committees from Frost, his family, or his business over the last four years.

Political figures who have received funds include state auditor Andrew Sorrell, state Representative Ben Harrison, and Alabama Board of Education member Allen Long.

Sorrell, currently running for Alabama Secretary of State in 2026, expressed to media that he was unaware of any suspicious activities until federal authorities revealed the situation.

His campaign, along with a partner PAC, reportedly received at least $71,000 from Frost-related sources.

“I, along with countless others, lost money when it was uncovered that First Liberty Building and Loan was scamming investors like Madoff,” Sorrell stated. He further noted that the organization was marketed as a “patriotic” and “Christian” investment opportunity through conservative channels.

Sorrell plans to return all contributions once the process is legally established for court-appointed recipients.

According to FCPA filings, Sorrell’s PAC provided a $29,000 loan to First Liberty in 2024, which accrued interest until spring 2025.

He reflected on the situation as unfortunate and indicative of a broader issue in the U.S., stressing the importance of recovering funds for the affected investors.

Ben Harrison, who received over $21,000 in donations from Frost’s family, claimed he had no prior knowledge of the SEC’s allegations. He mentioned considering legal action to return the funds and expressed his commitment to aiding the victims of this financial setback.

State Board of Education member Allen Long also received a $40,000 donation from a company affiliated with Frost in late 2023.

The Frost family’s political contributions extend beyond Alabama, as they have reportedly donated to figures such as Georgia Governor Brian Kemp, Florida Governor Ron DeSantis, and U.S. Representative Lauren Boebert. Georgia’s Secretary of State Brad Raffensperger is also seeking the return of Frost-related donations.

The Alabama Securities Commission is requesting anyone with relevant information to reach out at 1-800-222-1253.