(The Center Square) – Georgia Gov. Brian Kemp signed a bill Thursday that could help victims of financial fraud recoup some of their funds.
Senate Bill 284 allows the Securities commissioner to order those accused of fraud to return the money to their victims without a court order. The commissioner, also the secretary of state, could previously only invoke civil penalties that were remitted to the state.
“This law provides the teeth we need to demand justice and ensures that those who seek to defraud our citizens will face the full weight of the law,” Secretary of State Brad Raffensperger said.
The bill signing comes on the same day that federal prosecutors indicted former Newnan bank manager Edwin Brant Frost IV on a wire fraud charge.
Investors were told by Frost that they were investing in what he called “Bridge Loans,” which were short-term loans provided to businesses, according to the U.S. District Attorney’s Office for the Northern District of Georgia. Investors were told they would make between 8% to 18% in interest payments when the businesses repaid the loans, prosecutors said.
Frost did not use all of the money to fund the loans and also did not tell investors that some of the loans defaulted, according to a release from the U.S. Attorney’s Office. At least 300 people invested and Frost raised $140 million, the release said.
Prosecutors said Frost used more than $5 million of investors’ money to purchase items and make $570,000 in political contributions.
Frost contributed to conservative candidates, including U.S. Reps. Andy Ogles, R-Tenn., Chip Roy, R-Texas, Lauren Boebert, R-Colo., and a political action committee for former Fla. Rep. Matt Gaetz, according to online records.
“Frost allegedly operated a classic Ponzi scheme – using new investor funds to pay earlier investors while concealing significant financial losses,” said 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.”
Frost was arraigned before a federal magistrate on Thursday and was released on bail, prosecutors said.
