Paul Thomas Croft, Jonathan David Frost, Matthew William Dira
U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 26638 / September 14, 2026
Securities and Exchange Commission v. Paul Thomas Croft et al., No. 1:26-cv-00257 (E.D. Tenn. filed Sept. 11, 2026)
SEC Charges Two Promoters and Salesperson in Alleged $64 Million Offering Fraud
On September 11, 2026, the Securities and Exchange Commission filed fraud charges against Paul Thomas Croft, Jonathan David Frost, and Matthew William Dira, alleging a multimillion-dollar, multi-year offering fraud.
According to the SEC’s complaint, filed in the U.S. District Court for the Eastern District of Tennessee, between approximately January 2021 and September 2023, Croft and Frost, through entities including Croft & Frost, PLLC and others, fraudulently offered and sold securities in the form of promissory notes and membership interests in limited liability companies, raising approximately $64 million from more than 230 investors. The complaint alleges that, rather than using funds for the profit-making activities that were represented to investors, Croft and Frost misappropriated investor funds to cover the expenses of a separate tax preparation business and finance their own luxury lifestyles and used investor funds to make Ponzi-style payments to existing investors. The complaint further alleges that Dira, acting as a securities salesperson and administrator, continued to solicit and sell millions of dollars’ worth of promissory notes to investors—while earning more than $500,000 salary and commissions—even after receiving communications warning that Croft and Frost were likely running a Ponzi scheme.
The SEC’s complaint charges Croft and Frost with violating Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and charges Dira with violating Section 17(a)(2) and 17(a)(2) of the Securities Act and Section 15(a)(1) of the Securities Exchange Act of 1934. Frost consented to the entry of a bifurcated judgment, subject to court approval, that would permanently enjoin him from violating the charged provisions of the federal securities laws and from participating in the issuance, purchase, offer, or sale of any security except for his own personal accounts, and order him to pay disgorgement, prejudgment interest, and a civil penalty in amounts to be determined by the Court upon motion by the Commission.
Frost previously pleaded guilty to criminal fraud and money laundering charges in a parallel criminal case, United States v. Jonathan D. Frost, No. 1:26-cr-00004-TRM-CHS (EDTN).
The SEC’s investigation was conducted by Tiffany Kunkle and Justin Delfino of the SEC’s Atlanta Regional Office and supervised by Peter J. Diskin and Justin Jeffries. The SEC’s litigation will be conducted by Paul Kim and Supervised by M. Graham Loomis.