Former Mississippi Welfare Director Charged With Embezzling Millions Jones said he had no knowledge of any alleged fraud and that the nonprofit had cooperated with audits from the department as well as the auditors office. HINDS COUNTY, Miss. Special agents from the office of State Auditor Shad White have arrested John Davis, the former director of the Mississippi Department of Human Services, and five others in a multimillion-dollar embezzlement scheme. The Mississippi Department of Human Services has hired a new law firm to recover money that was misspent as part of the state's welfare fraud case. The complexity of the cover-up was as such that it wouldve been highly unlikely that anybody wouldve uncovered it, except by being able to find it from within, Blanton said. Representatives for the nonprofits have not returned several calls and emails over the last year. This work is licensed under a Creative Commons Attribution-NoDerivatives 4.0 International License. Former MDHS Director John Davis pleads guilty to defraud conspiracy By clicking submit, you agree to share your email address with Mississippi Today. Thats to be open with how funds are distributed and who theyre going to.. MDHS sits down to discuss the embezzlement case for the first time since the news broke a week ago. Johnson said, "I was a special investigator, special investigator, a DHS investigator.". It's unclear when they will be unsealed. The News also directed millions in public money to their private businesses, used the money personally, and concealed the transactions, according to the auditors. Photo gallery: Equestrian program at Mississippi College, Nurse recounts horrors inside a Yazoo City nursing home, Coverage of Mississippis sprawling welfare scandal, Creative Commons Attribution-NoDerivatives 4.0 International License, Proudly powered by Newspack by Automattic. John Davis was indicted along with several others in the largest embezzlement and fraud scheme in Mississippi history. Others doing this kind of thing are on notice: this will not be tolerated now, White said in a statement. You have to credit Mississippi Today. Farmington City Clerk Arrested for Embezzlement Mississippi Office of As a reminder, the scheme includes more than $4.15 million dollars in embezzled government money. He added that, Anything they gave to the campaign will be there waiting to return to the taxpayers and help the people it was intended for. The audit released Tuesday also criticized the welfare department for continuing to fund two now-embattled nonprofits well into fiscal year 2020, as Mississippi Today first reported last July, even after learning that the auditor suspected they were responsible for the misspending of tens of millions of welfare dollars, the audit said. The director, John Davis, who retired in 2019 from the Department of Human Services, was one of six people charged in what the state auditor, Shad White, said was the largest embezzlement scheme that the office had seen in at least 20 years. Johnson says Davis then asked everyone to put away their cellphones and called him into the hallway. Blanton also said that since the department was still under contract with the nonprofits in the last months of 2019, the beginning of fiscal year 2020, it could not simply cut off their funding while auditors were investigating allegations. Follow him on Twitter @gbolognaCL. Theyve also started bringing in subgrantees for training on whats expected and how they can best meet federal guidelines. The cast of characters, villains and heroes, in the Mississippi Department of Human Resources (MDHS) case seems to grow by the hour. We center readers in everything we do, informingand engagingMississippians through reporting, podcasts, events and online communities. He attended a professional development conference led by Davis outside the department and he says the encounter left him confused and embarrassed. MDHS paid Mississippi Community Education Center $19,404 two days before the state auditor's office arrested the News and former Human Services Executive Director John Davis as part of the. Please reload the page and try again. Brett DiBiase has pleaded guilty for his role in an embezzlement scheme that investigators said was the largest in state history.The former pro wrestler was arrested in July 2019 along with several others, including former Mississippi Department of Human Services Director John Davis.DiBiase entered a guilty plea Thursday in Hinds County Circuit Court to making fraudulent statements for the . Sign up for our daily newsletter to get the latest updates on the Mississippi welfare scandal. The funds in question were part of the Temporary Assistance for Needy Families program, which is administered by DHS. You do not have the right to treat taxpayer money as your own or to lie to the taxpayers about what youre doing with that money. Nine of them have pleaded guilty to embezzlement charges . Nancy New and her son, Zach New, stand accused of using the News nonprofit, MCEC, to pay for DiBiases drug treatment using TANF funds, White said. Michael Maurello, 56, worked as a payroll manager at the . Wooten pushed back on this argument, repeatedly asking the attorney representing White and Anderson from the state attorney generals office how the gag order prevents White from doing his job, namely auditing and investigating government spending. You and Nancy stuck your neck out for me with jake and Prevacus I know and thats going to turn out very good I believe.. So,there was nothing illegal about those transfers, only how it was spent after that. All persons arrested by the Mississippi Office of the State Auditor are innocent until proven guilty in a court of law. Any amount helps us keep producing quality journalism for Mississippi. She asked if media coverage of an auditors investigation is initiated when a reporter asks the office a question or after the office publicizes the case. White and Anderson did not object to being included in the gag order, agreeing to refrain from discussing Davis criminal culpability. This inability to validity MCECs records is further complicated by the fact that the principals of MCEC are currently under indictment and essentially unavailable to MDHS to review any further documentation or answer questions.. According to the auditor's office, the classes never took place. The complexity of the cover-up was as such that it wouldve been highly unlikely that anybody wouldve uncovered it, except by being able to find it from within, Blanton said. Davis attorney argues that when White and Anderson have discussed the case with the media, they have focused solely on Davis actions and not the several other employees who approved various purchases or the agency policies that he argues sanctioned Davis conduct. A former Department of Human Services employee, Latimer Smith, 26, was also arrested, according to Mr. White. According to the auditor's office, Davis and another DHS employee made fake invoices to pay Brett DiBiase a former pro wrestler who later became a DHS employee with money intended to helppoor families. The matter was referred to the Hinds County District Attorney Office for criminal prosecution after terminating her employment. The scheme came [] Five plead not guilty in MDHS embezzlement scheme - Vicksburg Daily News Former Director of DHS and others arrested in largest public - WJTV Davis resigned as head of MDHS in July, 2019. "We look forward to this moving through the justice system to a final disposition.". Theyve also started bringing in subgrantees for training on whats expected and how they can best meet federal guidelines. Mr. White said the arrests stemmed from an eight-month investigation into the misappropriation of funds from the Temporary Assistance for Needy Families program, which the state welfare agency administers. Heres an attempt to connect the players and what little is known thus far of the plot in this shameful drama: Mississippi state auditors officials were to meet Monday with FBI agents to brief the Feds on the unfolding Mississippi Department of Human Services (MDHS) embezzlement scandal. Between 2016 and 2018, the nonprofit Mississippi Community Education Center doled out $5 millionallegedly at Favres requestto the University of Southern Mississippi, where Favre attended and where his daughter also attended and played volleyball, to pay for a new volleyball court, according to Mississippi Today; the nonprofit also paid him $1.1 million to promote a program called Families First. 0:27. At Davis direction, MCEC used TANF money received from DHS to pay for DiBiases opioid treatment at the Rise in Malibu facility, White said. When it comes to finding the misspending detailed in the indictments, this was the atmosphere at the agency at the time. Here's an attempt to connect the players and what little is known thus far of the plot in this shameful drama: 2023, Hearst Television Inc. on behalf of WAPT-TV. They were among 15 current and former Boston police officers charged in the alleged overtime scheme involving the evidence control unit. Nancy New was the owner and director of the Mississippi Community Education Center and New Learning, Inc. She also founded New Summit, a private school in Jackson. MDHS officials say former director John Davis created an environment of "Thats to create the transparency. Since then, the subgrantee process has changed and the state plan for TANF reflects those changes. We believe that an informed Mississippi is a better Mississippi. Under the plea agreement, the State recommends that Davis be sentenced to 90 years with 32 years of that sentence to be served in prison, as well as be required to pay restitution in the amount of. "I now have the opportunity to focus on my family at home and pursue a position outside of state government," Davis wrote in a statement announcing his resignation. (WLBT) - It was one week ago that the news broke of whats been called the largest public embezzlement case in state history. We did reach out to Davis attorney Merrida Coxwell for comment. There was also no answer at the main office of the Mississippi Community Education Center in Jackson. following organizations: Whoops! wrestler Brett DiBiase, 31, who state auditors said was paid with welfare funds for teaching classes about drug use. On Tuesday, Hinds County Circuit Court Judge Adrienne Wooten spoke strongly in defense of a gag order in the case of former welfare director John Davis, saying that media coverage of the scandal threatens the courts ability to assemble an impartial jury. Contests. She received the National Press Foundations 2020 Poverty and Inequality Award. "Thats to create the transparency. Sign up for our daily newsletter to get the latest updates on the Mississippi welfare scandal. NEMiss.NEWS is a locally owned and operated online news magazine containing news, information, opinion, etc. MDHS released a statement about the arrests. We want to make our employees comfortable and proud to be a part of DHS.. Check back for updates. You deserve answers. Hurst said, neither the FBI nor the United States Attorneys Office was contacted by the State Auditor or the Hinds County District Attorney about this investigation, although millions of federal dollars are alleged to have been stolen.. Everything was going well. The latest breaking updates, delivered straight to your email inbox. To republish online, simply click the button, copy the html code and paste into your Content Management System (CMS). All of this is being put in place to make sure the sins of the past never recur in the future, added Blanton. She said that you were disrespectful.". Former DHS director, wrestler arrested in 'largest public embezzlement We are verifying those as well to determine the validity of such. Davis and Smith created invoices to pay DiBiase TANF money for teaching classes about drug abuse, but DiBiase was in a luxury rehabilitation facility for his own drug use in California at the time and did not perform the services, White said. Start a recurring donation of any amount to further this work and help hold public officials and those in power accountable. This is a developing story. Look for the "Republish This Story" button underneath each story. Five plead not guilty in MDHS embezzlement scheme Much more remains to be revealed, including questions such as: If youre thinking of altering your workout routine, youre probably looking for new exercises and equipment to help you reach your fitness goals. The State Auditor's office says Davis allowed 98 million dollars meant for the needy to flow into nonprofits where the money was spent to hire lobbyists, on contracts for family members, to purchase vehicles, even repaying a loan. Though text messages show Bryant accepted an offer to receive Prevacus shares after he left office, Bryant told Mississippi Today he had no intention of accepting the stock. What is the relationship between Davis and the News? We do appreciate the partnership with Victory Sports and Pauls work. Since then, the subgrantee process has changed and the state plan for TANF reflects those changes. However, in saying that, we want to be good stewards of all financial support. Davis is indicted along with Nancy New, her son Zach New, Anne McGrew, Latimer Smith and Brett DiBiase. The welfare agencys documentation, or lack thereof, shows Mississippi Community Education Center and Family Resource Center of North Mississippi did not, as New stated, evaluate the services and outcomes of its grantees. Anderson has ushered in new procurement practices and financial controls to increase accountability among the departments welfare grantees. Mississippi Auditor Shad White attends Cindy Hyde-Smith's watch party at the Westin Jackson Wednesday, November 27, 2018. Before joining the staff at Mississippi Today in September of 2018, Anna worked for three years at Clarion Ledger, Mississippis statewide daily newspaper. You may opt-out by. JACKSON, Miss. Former MDHS Director, John Davis, is from Brookhaven, Lincoln County, and worked for MDHS in that county before his rise to the top of the state MDHS organization. JACKSON, Miss. Amazon Has Uncanny Dupes of CB2's Popular Dining Chair for Hundreds Less. Look for the "Republish This Story" button underneath each story. An eight-month investigation revealed that the accused conspired to illegally obtain millions in public funds from the Temporary Assistance for Needy Families program administered by DHS, White said. We work to provide free, accessible news for everyone to create a more informed Mississippi and hold public officials accountable. Brett DiBiase pleads guilty in human services embezzlement scheme DHS made a post on Facebook Wednesday saying it "self-reportedthe information" that led to the investigation. Former DHS director, wrestler arrested in 'largest public embezzlement case in state history'. Blanton explained that the U.S. Department of Health and Human Services Office of Inspector General had told the state agency not to interfere with its investigation and that the auditors office was already aware of the federal investigators involvement. He then earned a Doctor of Laws degree from Harvard University. No one has been charged in connection with these purchases. White confirmed in an interview earlier today that Governor Bryant, himself a former state auditor, was indeed the whistleblower who brought the case to the state auditors office in June. MDHS is concerned about the authenticity of MCEC documents due to submission of numerous versions of the same request in a monitoring visit, Anderson wrote to the auditors office in March in response to the latest report. Zach New was arrested in connection with the Mississippi Department of Human Services embezzlement scheme earlier this week. Connecting the dots: the MDHS embezzlement scandal The cast of characters, villains and heroes, in the Mississippi Department of Human Resources (MDHS) case seems to grow by the hour. DiBiase was allegedly paid to teach classes about drug use and instead used the money to pay for his own drug rehabilitation in Malibu, California. It was not immediately clear Wednesday night if Mr. Davis or the other five charged had lawyers, and no one answered the phone at the homes of Mr. Davis, Ms. New, Mr. New and Mr. Smith. Latimer Smith is a former employee of DHS. We will continue to follow this case and update you as new developments are made available. A former top state official in Mississippi pleaded guilty Thursday to state and federal charges in connection to an embezzlement scheme that auditors say misused millions of welfare dollars,. If you share our stories on social media, please tag us in your posts using. All of this is being put in place to make sure the sins of the past never recur in the future, added Blanton. They then converted funds to their personal use and concealed the conversion through various fund transfers, fraudulent documents, at least one forged signature and deceptive accounting measures, investigators said. I'm the Executive Director. Ex-Mississippi DHS head arrested in embezzlement scheme, auditor says There really hadnt been the internal auditing capability, the program integrity ability before that we had at that point that was created, explained DHS Chief Communications Officer Danny Blanton. Brett DiBiase was a former professional wrestler with World Wrestling Entertainment,who later worked at DHS as the deputy director of transformational change, according to his LinkedIn page.