Groups tied to First Liberty accused of campaign finance violations

Two Republican groups linked to the defunct First Liberty Building & Loan likely sought to illegally influence Georgia elections, the State Ethics Commission charged Thursday.

In an unanimous vote, the commission found probable cause that the Georgia Republican Assembly and the Georgia Republican Assembly Political Action Committee violated campaign finance laws dozens of times in recent years. Among other things, the commission found they failed to disclose more than $180,000 of campaign contributions as they rose to become dominant forces in state Republican politics.

In a written response, the GRA-PAC conceded that the ethics commission had probable cause to believe it violated campaign finance laws. But the Georgia Republican Assembly contested the charges, saying the two organizations are independent and it shouldn’t be charged with alleged violations by the PAC.

“The GRA-PAC was not operated in a way that the Georgia Republican Assembly had any factual or legal control over its actions,” GRA attorney Catherine Bernard told the commission.

But the ethics commission disagreed after hearing evidence of close ties between the groups, which shared many of the same board members.

Commission Executive Director David Emadi said he was pleased the commission “ruled there was ample evidence to support allegations that these groups broke the law by illegally influencing election results over a number of years.”

Thursday’s commission action is the latest fallout from the collapse of Newnan-based First Liberty Building & Loan last summer. Federal officials have accused First Liberty of operating a $140 million Ponzi scheme, and some investors say they have lost hundreds of thousands of dollars. The federal investigation continues, and the secretary of state’s office also is investigating First Liberty.

Campaign contributions from First Liberty founder Brant Frost IV and his family also have come under scrutiny. According to federal authorities, Frost used investors’ money to make more than $570,000 in campaign contributions. An Atlanta Journal-Constitution investigation found the Frosts spent more than $1.4 million in contributions to campaigns, from coast to coast.

The Georgia Republican Assembly has also come under scrutiny. The group has pushed a right-wing agenda that has challenged more traditional conservative Republicans. Frost’s son, Brant Frost V, ran the GRA-PAC.

Georgia law requires groups that spend money to influence elections to register with the ethics commission and disclose their spending. In July, the ethics commission charged the GRA-PAC with failing to register as an independent political committee, failing to file required campaign reports and failing to disclose campaign contributions.

In October the commission added the parent organization as a defendant in the case. The commission has charged both groups with 50 violations of campaign finance laws.

On Thursday, Bernard argued they are separate groups with separate bank accounts. She said the GRA has no control over the political action committee.

Ethics commission attorney Timothy Baywal laid out evidence that showed close ties between the groups. He showed they have common leadership and cited examples of the GRA raising money for the political action committee. He even cited examples of GRA officials directing the PAC to spend money on specific candidates.

Baywal said the PAC’s bylaws show it could only spend money on candidates the GRA endorsed and who were members of the GRA.

“This is operating like a closed shop,” Baywal argued.

The board’s finding of probable cause means the commission will continue its investigation. If the commission ultimately finds the GRA and its PAC violated campaign finance laws, they could face substantial civil penalties.

“We look forward to moving forward to a full bench trial and questioning more witnesses under oath to ensure the violators of Georgia campaign laws are held accountable for their actions,” Emadi said.