Timothy Darnell, Ex-Bankers Life Securities Broker has Five Complaints
Timothy Nathaniel Darnell, a former Bankers Life Securities financial representative in Atlanta, Georgia, is reportedly the subject of five pending FINRA arbitration complaints alleging he sold clients promissory notes tied to the collapsed First Liberty Building & Loan Ponzi scheme. Bankers Life Securities reportedly discharged Darnell in September 2025, and investors searching for Timothy Darnell complaints should know that a Georgia securities regulator has since taken separate action against him as well. Investors who believe they were affected may want to speak with a FINRA arbitration attorney about their options.
Timothy Darnell Bankers Life Securities Complaints and Discharge
According to Darnell’s FINRA BrokerCheck record (CRD #6666469), Darnell was registered with Bankers Life Securities, Inc. in Atlanta from August 2016 until September 2025. He was also a Bankers Life insurance agent going back to 2014.
Bankers Life Securities and Bankers Life Advisory Services discharged Darnell on September 12, 2025. Per his BrokerCheck disclosure, the firm reportedly cited three reasons: (1) failure to disclose outside business activities, (2) participation in undisclosed and unapproved private securities transactions, and (3) use of off-channel communications with clients in violation of firm policy. Darnell’s BrokerCheck record lists two outside, investment-related ventures — Persevero Properties and The Every Thought Captive Foundation — among his disclosed outside business activities.
FINRA Arbitration Complaints Allege Selling Away
Since Darnell’s discharge, five customer arbitration claims have been filed against him with FINRA Dispute Resolution Services, all still pending as of this writing. Each alleges unsuitable recommendations, breach of fiduciary duty, negligence, misrepresentation, and selling away in connection with an alleged Ponzi scheme run by First Liberty Building & Loan, LLC, with promissory notes as the product at issue:
- Docket #25-01840, filed September 4, 2025 — $1,000,000 in alleged damages
- Docket #25-01969, filed September 25, 2025 — $400,000 in alleged damages
- Docket #25-02288, filed October 21, 2025 — $350,000 in alleged damages
- Docket #26-00153, filed January 22, 2026 — $575,000 in alleged damages
- Docket #26-00188, filed January 27, 2026 — $650,000 in alleged damages
Combined, the five pending complaints allege nearly $3 million in investor losses. Selling away occurs when a broker recommends or facilitates an investment that has not been approved by, or disclosed to, the broker’s registered firm. FINRA Rule 3280 requires written notice to the firm before a broker participates in private securities transactions of this kind, precisely so the firm can supervise the activity and evaluate the risk to customers. None of these allegations have been proven, and Darnell has not been found liable in any of the pending matters.
The First Liberty Building & Loan Ponzi Scheme
The claims against Darnell are tied to the collapse of First Liberty Building & Loan, LLC, a Newnan, Georgia lender founded by Edwin Brant Frost IV. According to the SEC’s litigation release, the agency filed emergency charges against Frost and First Liberty on July 10, 2025, alleging the company raised at least $140 million from roughly 300 investors between 2014 and June 2025 through loan participation agreements and promissory notes promising annual returns of 8% to 18%. The SEC alleges First Liberty operated as a Ponzi scheme beginning around 2021, using new investor money to pay earlier investors, while Frost allegedly diverted investor funds to personal expenses, including credit card payments, a rare coin dealer, and family vacations. Frost has since pleaded guilty to a felony wire fraud charge, according to trade press reports.
Darnell is not a defendant in the SEC’s case against Frost and First Liberty. His alleged connection to the scheme comes from the FINRA arbitration complaints and a separate Georgia state regulatory action described below, both of which allege he recommended First Liberty promissory notes to his own clients.
Georgia Securities Regulators Take Action Against Darnell
On February 24, 2026, the Georgia Secretary of State’s Securities and Charities Division reportedly issued an emergency cease-and-desist order against Darnell, according to reporting by The Georgia Record. The order allegedly imposes a maximum civil penalty of $500,000, bars Darnell from acting as a securities agent or investment adviser representative in Georgia, and refers the matter to the Cobb County District Attorney’s office for potential criminal prosecution, as well as to the Georgia Insurance Commissioner. This is a state regulatory bar, separate from Darnell’s FINRA registration status — it is not the same as a FINRA bar, and no criminal charges have been filed against Darnell as of this writing.
The order alleges Darnell recommended First Liberty investments to 45 clients between December 2020 and June 2025, totaling roughly $6.675 million in principal, with about 60% of those investors age 60 or older. It further alleges Darnell earned approximately $249,110 in commissions on those recommendations and violated the Georgia Uniform Securities Act by failing to disclose outside business activities, engaging in unauthorized private securities transactions, using off-channel communications, withholding commission details, and describing the investments as “guaranteed” or “secure.” These figures come from state regulatory reporting rather than a FINRA or SEC filing, and Darnell reportedly had 30 days from the order to request a hearing to contest it.
What Investors Who Worked With Timothy Darnell Should Know
Brokerage firms are responsible for supervising their registered representatives’ outside business activities and private securities transactions. When a firm fails to detect or stop a broker from selling away, the firm — not just the individual broker — may be held liable for resulting investor losses through FINRA arbitration. If you invested in First Liberty Building & Loan promissory notes or other outside investments through Timothy Darnell while he was registered with Bankers Life Securities, you may want to have your account reviewed. The White Law Group, national securities fraud attorneys with offices in Chicago and Seattle, offers free consultations to investors who believe they have a claim. You can also learn more about the arbitration process from our FINRA arbitration attorney page.
Frequently Asked Questions
What is “selling away,” and why does it matter for my investment in First Liberty Building & Loan?
“Selling away” refers to a registered representative selling securities that were never approved or supervised by his brokerage firm. Timothy Darnell (CRD# 6666469) was registered with Bankers Life Securities, Inc. when investors allege he recommended promissory notes tied to First Liberty Building & Loan, LLC — investments the firm allegedly never approved or reviewed. Because the transactions allegedly happened outside Bankers Life Securities’ oversight, the firm had no opportunity to evaluate whether the notes were suitable before investors put money in. That distinction matters because it shapes who can be held accountable: the broker who allegedly recommended the notes, and potentially the firm that employed him, under a failure-to-supervise theory. Learn more about pursuing a FINRA arbitration claim if you invested in First Liberty Building & Loan through Darnell while he was registered with Bankers Life Securities.
Can Bankers Life Securities be held responsible for my losses, even though it didn’t know about or approve the First Liberty Building & Loan transactions?
Possibly. FINRA member firms have an ongoing duty to supervise their registered representatives, which includes reasonable systems designed to detect undisclosed outside business activities and unapproved private securities transactions. If Bankers Life Securities reasonably should have identified red flags in Timothy Darnell’s alleged conduct — and didn’t — investors may have a failure-to-supervise claim against the firm itself, separate from any claim against Darnell individually. This is a fact-specific question that depends on what the firm knew, or reasonably should have known, and when. An attorney can review the specifics of your account and Darnell’s disclosure history to evaluate whether a supervisory claim applies to your situation.
What should I do if I invested in First Liberty through Timothy Darnell?
Gather your account statements, any promissory note documents, and records of communications with Darnell, then have an attorney experienced in FINRA arbitration review your options. Investors may have claims against both the broker and his supervising firm for failure to supervise.
Have You Lost Money Investing With Timothy Darnell?
The White Law Group is a national securities fraud, securities arbitration, and investor protection law firm with offices in Chicago and Seattle. If you invested with Timothy Darnell or Bankers Life Securities and suffered losses, contact us for a free consultation at (888) 637-5510 or visit our contact page. You can also read more about the FINRA arbitration process on our FINRA arbitration attorney page.
