An investment adviser who nearly two years ago helped send a lifeline to a struggling South Georgia bank is missing, and authorities accuse him of a $40 million fraud.
The Securities and Exchange Commission said Monday it has received a federal court order to freeze the assets of Aubrey Lee Price, and several associated businesses.
In a 22-page letter to investors, Price allegedly admitted he made false statements to conceal losses of $20 million to $23 million.
Regulators said Price told clients he was investing their money in traditional stocks, but he also put money into "illiquid" bets including South American real estate and shares of Montgomery Bank & Trust.
Tens of millions of dollars were placed into an account at Goldman Sachs, which suffered heavy losses, the SEC complaint said.
William P. Hicks, associate director of the SEC in Atlanta, said Price "made woeful financial transactions" that he hid from his investors.
"Now both the money and Price are missing," Hicks said.
Securities regulators accuse Price of falsifying account information to conceal the losses. The SEC also said frequent transfers of investor funds were made to the operating account of one of Price's companies.
The FBI is among the agencies assisting in the matter.
In late 2010 some of Price's investors put at least $10 million into MB&T, a small bank in Ailey, about 170 miles southeast of Atlanta. Price is listed on the bank's website as a director.
MB&T was considered one of the state's most troubled institutions in December 2010, when the investment was made, and it remains stressed.
Ailey locals pitched in an additional $4 million, in a combined investment that helped rescue the bank from the brink of failure. State banking experts hailed the deal as a "success story" to save a more than 85-year-old institution, and the story was highlighted in a front page article in the Atlanta Journal-Constitution in January 2011.
The SEC said that investment is now "substantially worthless, as the bank's cash assets have been substantially depleted," and most of its reserves "were misappropriated by Price and lost in trading."
In a statement, Trae Dorough, MB&T President and CEO, said "the bank believes that it has sufficient liquidity to continue to meet its customers' deposit obligations, which are insured by the Federal Deposit Insurance Corporation to the maximum extent permitted under law."
He also said the the bank is fully cooperating with regulators.
State Rep. Greg Morris, R-Vidalia, chairman of the House banking committee and a director at MB&T, directed comment to Dorough.
The SEC said price had more than 100 investors, mainly in Georgia and Florida.
Price, who lives in Lowndes County near the Florida line, was reported missing by his family earlier this month, Lowndes County Sheriff Chris Prine said in a statement.
Price left home June 16 and was supposed to fly to Guatemala for business, he said, but Price hasn't contacted his family and never arrived at his destination.
The sheriff said Price mailed parcels to several people, including relatives, before he disappeared.
One published report said Price boarded a ferry in Key West. A suicide note was later found aboard the vessel, according to Southeast Georgia Today, a news website for radio stations in Vidalia.
Toombs County Sheriff Junior Kight told the stations it is not clear if Price actually jumped from the ferry. Kight did not immediately return a message on Monday seeking comment.
People with information about Price's whereabout can call the FBI in Atlanta at 404-679-9000 or the Lowndes County Sheriff's Office at 229-671-2985.
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