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Tuesday, Mar 24, 2026
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SEC Charges Stuart Frost

The Securities and Exchange Commission today charged Stuart Frost of Laguna Niguel and his investment advisory firm Frost Management Company LLC with fraud and breach of fiduciary duties for charging over $14 million in undisclosed and excessive incubator fees to start-up companies.

The SEC said Frost raised nearly $63 million for his funds between 2012 and 2016. Frost then invested in start-up companies, which paid incubator fees to Frost Data Capital for operational support and other services in anticipation of the companies maturing and ultimately being sold.

“In reality, as alleged in the SEC’s complaint, a significant portion of the incubator fees were used to cover Frost Data Capital’s overhead and to pay Frost’s exorbitant salary and extravagant personal expenses,” said a SEC press release.

Sheppard Mullin, which is representing Frost, declined to comment.

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Peter J. Brennan
Peter J. Brennan
With four decades of experience in journalism, Peter J. Brennan has built a career that spans diverse news topics and global coverage. From reporting on wars, narcotics trafficking, and natural disasters to analyzing business and financial markets, Peter’s work reflects a commitment to impactful storytelling. Peter’s association with the Orange County Business Journal began in 1997, where he worked until 2000 before moving to Bloomberg News. During his 15 years at Bloomberg, his reporting often influenced financial markets, with headlines and articles moving the market caps of major companies by hundreds of millions of dollars. In 2017, Peter returned to the Orange County Business Journal as Financial Editor, bringing his heavy business industry expertise. Over the years, he advanced to Executive Editor and, in 2024, was named Editor-in-Chief. Peter’s work has been featured in prestigious publications such as The New York Times and The Washington Post, and he has appeared on CNN, CBC, BBC, and Bloomberg TV. A Kiplinger Fellowship recipient at The Ohio State University, he leads the Business Journal with a dedication to uncovering stories that matter and shaping the local business community and beyond.
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