Croft & Frost’s clients received no notice of the Chattanooga accounting firm’s bleak prospects before it abruptly laid off its staff days before a key tax filing date, according to a new lawsuit that accuses the owners of malpractice.
“Rather than advise customers, to whom they owed professional duties, that the accounting firm was teetering, the principals robbed Peter to pay Paul to stay afloat and kept promising the work would be done; meanwhile, not paying the huge staff necessary to do the work for thousands of customers,” the lawsuit said.
Filed by a former client of the firm on behalf of himself and other former customers, the suit is among the latest in a procession of lawsuits accusing Chattanooga accountant Jonathan Frost and his business partner, Paul Croft, of various breaches of trust. The filing seeks class action status.
In recent weeks, four moneylenders have in separate lawsuits accused Croft, Frost and their associated firms of defaulting on financial agreements collectively worth several million dollars. Meanwhile, an individual investor accused Frost and Croft of stringing him along with lies and misrepresentations, intermingling money between firms and defrauding him out of more than $1.5 million.