Alabama Officials Return Donations Tied to Out-of-State Ponzi Scheme

Alabama Officials Return Funds Linked to Alleged Ponzi Scheme

Alabama officials have returned a significant portion of campaign contributions linked to an alleged Georgia-based Ponzi scheme. According to campaign finance records, at least $58,800 in donations from the scheme have been returned. These funds were allegedly provided by Edwin Brant Frost IV, his family members, or his businesses, which contributed a total of $132,000 to Alabama politicians and political action committees (PACs).

Among those who received contributions are several prominent figures, including then-Rep. Andrew Sorrell, R-Muscle Shoals, who is now the Alabama state auditor and a candidate for Secretary of State; Rep. Ben Harrison, R-Elkmont; and Alabama State Board of Education member Allen Long.

Contributions and Returns

Sorrell, who received at least $55,000 from either Frost or his business entities, returned $25,000 to the court-appointed receiver in the lawsuit, S. Gregory Hays, on July 18. Additionally, Alabama Christian Citizens, Sorrell’s PAC, returned a $12,500 contribution on the same day.

Sorrell confirmed the return in a text message, stating, “My campaign got $25,000 contribution in May and I returned $25,000.” He also noted that the PAC returned $12,500 last year.

His campaigns began receiving contributions in 2021, with individual donations from Frost and his son, Brant Frost V. According to campaign finance records, both Frosts made personal donations to Sorrell’s auditor campaign totaling $7,500 in July 2021. Brant Frost V made an additional contribution of $2,500 to Sorrell’s campaign the following March.

First Liberty Capital gave Sorrell’s auditor campaign $10,000 on Dec. 13, 2021, and in May 2022, Sorrell received $10,000 from First National Investments, another one of the Frost’s investment entities.

When asked about the remaining $30,000 in contributions, Sorrell responded, “The account you are inquiring about was closed in February with a zero balance and no transfer of funds.”

Other Politicians Return Donations

Harrison returned $21,300 in contributions he received in 2022 on July 28. Long, who received the largest one-time donation of $40,000, stated in a text message that he has “refunded every remaining dollar in (his) campaign account to the court appointed receiver to (e)nsure that the victims are able to recoup as much their investment as possible.”

Long, who is not up for re-election in 2026, is not required to file a campaign finance report until January.

Legal Action and Allegations

A lawsuit filed by the U.S. Securities and Exchange Commission (SEC) on July 10 in the U.S. District Court for the Northern District of Georgia alleged that Frost and his associated investment firms raised at least $140 million between 2014 and 2025 through fraudulent means. Frost is accused of misappropriating over $5 million of investor funds for himself and his family members. The SEC said Frost used $570,000 from the allegedly misappropriated money for political donations.

According to the lawsuit, Frost and First Liberty Building & Loan told investors that their funds would be used to provide “Bridge Loans” to small businesses seeking long-term SBA loans. These investments offered annual returns ranging from 8% to 18%. The SEC alleges that Frost and his entities did not use investor funds as represented, and most of the Bridge Loans ultimately defaulted.

The SEC further claims that First Liberty operated as a Ponzi scheme as early as 2021, using funds from new investors to make interest payments to existing investors. The complaint states that “most, if not all, of the funds raised through the publicly advertised offering were either misappropriated or used to make Ponzi-style payments to existing investors.”

Response from State Officials

Alabama Secretary of State Wes Allen urged officials to return contributions tied to Frost and his business entities, stating that he takes “allegations of financial fraud seriously.” However, the Alabama Secretary of State’s Office oversees campaign finance reporting but does not have the power to investigate or prosecute alleged violations of the law or compel the return of contributions.

Later that month, Amanda Senn, director of the Alabama Securities Commission, said she opened an inquiry into the alleged scheme and is monitoring the investigation in Georgia.