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( WJTV) - A former employee for the Mississippi Department of Human Services (MDHS) was arrested for embezzlement after an investigation by the Investigations Division of . Get the Android Weather app from Google Play, Chinese electric vehicle brands expand to global, Met Gala: Rihanna, Jared Leto as Choupette, Kim K., Crisler still running for sheriff despite indictment, Met Gala 2023 live updates: Fashion highlights from, Canadian folk singer Gordon Lightfoot dies at 84, MS Insight for April 30, 2023: Steffey and Thompson, Poll: Mississippians strongly favor Presleys ideas, Poll: Presley slips, Gov. Nancy New and her son are also accused of transferring millions in TANF funds to their private businesses, White said. 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. There is no division there when it comes to the criminal portion of the case, Wooten said. The latest breaking updates, delivered straight to your email inbox. The former director of Mississippis welfare agency was arrested on charges that he took part in a scheme to embezzle millions of dollars for personal use and to pay for a former professional wrestler to go to a luxury drug rehabilitation center, the state auditor announced on Wednesday. That ultimately led to (Wednesday's) arrests," DHS officials said in a statement. Hearst Television participates in various affiliate marketing programs, which means we may get paid commissions on editorially chosen products purchased through our links to retailer sites. At Davis direction, MCEC used TANF money received from DHS to pay for DiBiases opioid treatment at the Rise in Malibu facility, White said. 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.. Bryant denied introducing Favre or Vanlandingham to the nonprofit director, Nancy New. Help keep the momentum going by rejoining our member community today. Johnson says he had heard rumblings from other employees but didn't pay much attention. Matter of fact I had gotten a promotion to another department, Johnson said. Ricky Jones, who has served as president of 100 Black Men of Jackson since March, said his organization just learned about the investigation last week when DHS notified them they would not be receiving a welfare grant this year. A major part of Reevess education agenda has been to funnel state tax money to New Summit and other private schools in the state, including another one owned by New and son. He also denied knowing Favre and Vanlandingham were receiving public funding for Prevacus, though text messages suggest he knew. Many more millions are yet to be accounted for and investigators have not revealed the involvement of any other figures, such as state leaders, in the scheme. Looking for something special to get your mom for Mothers Day? Check back for updates. 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. 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Mississippi Today retrieved a 2017 email from Family Resource Center director Christi Webb, in which she described to Davis allegations of blatant deception at one of their partners, the local community action agency in Greenville, Warren-Washington-Issaqueena-Sharkey Community Action Agency or WWISCAA. Records are kept for all cases from the last 20 years.The suspects were each released on their own recognizance Wednesday night, officials with the Hinds County Sheriff's Office said. Davis is indicted along with Nancy New, her son Zach New, Anne McGrew, Latimer Smith and Brett DiBiase. Wooten also said that its impossible to separate the discussion of Davis criminal culpability, as it relates to the narrow criminal charges against him, from the overall alleged scheme that occurred under his watch. White was appointed State Auditor by then-Governor Phil Bryant in 2018, when State Auditor Stacy Pickering resigned. This is a developing story. The funds in question were part of the Temporary Assistance for Needy Families program, which is administered by DHS. Show your support>>. A former Department of Human Services employee, Latimer Smith, 26, was also arrested, according to Mr. White. According to a Mississippi Today review of public records, the agency sent out 110 letters during roughly the last year under Anderson compared to four letters in fiscal year 2019 under Davis. 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. Instances of fraud and abuse in Mississippis welfare system were widespread, including among other organizations who received subgrants from the Families First nonprofits. And they did start an internal audit at the beginning of 2019. We believe that an informed Mississippi is a better Mississippi. Phil Bryant's office in June 2019. 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. Davis has pleaded not guilty. Phil Bryant's office in June 2019. Hall of Fame Gold Jacket Dinner on August 4, 2016 at the Canton Memorial Civic Center in Canton, Ohio. The two nonprofits ran an anti-poverty program called Families First for Mississippi, through which most of the money that was allegedly stolen, $4.15 million, or potentially misspent, $94 million, flowed. We work to find them. The Hinds County District Attorney secured an indictment on December 14, 2021. Check out these great suggestions. Help keep the momentum going by rejoining our member community today. Read more. By the time these meetings occurred in April, July and August of 2020 former welfare department director John Davis, who was indicted last year for his critical role in the alleged scheme, had been retired for about a year. Create a recurring donation today to join our mission. Brett DiBiase pleads guilty in human services embezzlement scheme Keisha Rowe Mississippi Clarion Ledger 0:00 2:16 Brett DiBiase, a former deputy administrator for the Mississippi Department. 0:27. Bluff City Life. Attempts to reach the sheriff's office for booking information were not successful. White launched the initial investigation into how Davis administered welfare. Before they exited their car, a woman was unlocking the door and waving them in. Newis accused of using TANF funds for her personal use as well as for investing in private medical device companies. Before joining the staff at Mississippi Today in September of 2018, Anna worked for three years at Clarion Ledger, Mississippis statewide daily newspaper. New sent a similar email to former Department of Human Services Director Christopher Freeze, who took over for Davis a few months after Davis retired in 2019. Others doing this kind of thing are on notice: this will not be tolerated now, White said in a statement. Since then, the subgrantee process has changed and the state plan for TANF reflects those changes. Uncovering the scheme goes back further than you may realize. Transparency: Is Mississippi spending too much or not enough money on childrens programs? The indictments, which were returned by a Hinds County grand jury, include a range of violations involving fraud and embezzlement, White said in a news release. But the criminal charges only scratch the surface: Under Davis leadership, independent auditors have found $70 million in improper purchases with federal public assistance dollars. He attended a professional development conference led by Davis outside the department and he says the encounter left him confused and embarrassed. The auditor's office said that the illicit money flowed through the Mississippi Community Education Center, a non-profit run by Nancy New and her son Zach New. They explained to her that there had been no activities and no clients and they were told to come up with some regardless. If you share our stories on social media, please tag us in your posts using. Whites statement said John Davis, former head of the Mississippi Department of Human Services, had been arrested and charged in connection with a multi-million-dollar embezzlement scheme.. 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. 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. With your help, we've gotten a lot done but we're not finished yet! . And at that point we did, Blanton said. MDHS sits down to discuss the embezzlement case for the first time since the news broke a week ago. Johnson said, "she said well I did speak with Mr. Davis and he asked for you to be terminated. He had the latitude to unilaterally disperse funds as he felt necessary or wanted to, Blanton confirmed. You cant edit our stories, except to reflect relative changes in time, location and editorial style. . Two days after the State Auditor arrested the News, Davis, DiBiase, et al, Governor Reeves made a statement in which he said, I can tell you right now, anything they (the News) gave to the campaign is going to be moved to a separate untouched bank account., Reeves said he did not know how much of the money his campaign received was stolen from taxpayers. We will continue to follow this case and update you as new developments are made available. What it looks like is that one side of the story is being put out there, Wooten said. - The former head of the Mississippi Department of Human Services has been arrested as part of a multimillion-dollar embezzlement scheme that among other things paid . 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. You can only publish select stories individually not as a collection. Any web site our stories appear on must include a contact for your organization. MDHS officials say former director John Davis created an environment of fear and intimidation, John Davis is indicted in an embezzlement scheme involving millions of dollars, Beloved Mississippi school bus driver killed during crash with 18-wheeler, Eleven players with Mississippi ties selected in 2023 NFL Draft, Truck possibly connected to Hinds County jail escape found in Newton County, Paraplegic fisherman speaks to Beulah Baptist Church, Belhaven football puts a smile on the face of little girl, City of Byram awarded thousands of state dollars for infrastructure projects, 58-year-old man shoots brother after argument over a dog in Hazlehurst, Request a First Alert Weather School Visit, Advertising Non-Discrimination Certification. If that doesnt happen, that money will go to a deserving charity.. White and Anderson did not object to being included in the gag order, agreeing to refrain from discussing Davis criminal culpability. The audit released less than a year later said that according to its budget, Victory Sports used the nearly $1.4 million welfare subgrant to pay for staff and coaches, a program design fee, equipment, an onsite nurse, marketing and other administration costs, and to purchase a $20,000 trailer and a $70,000 vehicle. JACKSON, Miss. Listen to this article Five of the six people accused in what could be the largest embezzlement scheme on record in Mississippi pleaded not guilty on Friday. You may opt-out by. Thats to be open with how funds are distributed and who theyre going to.. John Davis, who last year retired from the Department of Human Services, used some of the funds to pay for Brett DiBiase, a former professional wrestler, to go to drug rehab, the state auditor said. Hurst said federal law enforcement was not aware of the MDHS investigation until they read about it in media reports. We prefer Author Name, Mississippi Today in the byline. Amazon Has Uncanny Dupes of CB2's Popular Dining Chair for Hundreds Less. The purported messages also show a request from Favre asking members of the group to help to pay a $1 million debt Favre owed to the University of Southern Mississippi for the volleyball court he promised the school. The former head of the Mississippi Department of Human Services has been arrested as part of a multi-million dollar embezzlement scheme that among other things paid for a former professional wrestler to go to a luxury drug rehabilitation center in California, the state auditor announced Wednesday. We are verifying those as well to determine the validity of such. Special agents from the office of State Auditor Shad White have arrested John Davis, who retired after 28 years with DHS on July 31, 2019. following organizations: Whoops! The Auditors office has made it clear that the investigation is ongoing and more arrests are still possible. The suspects were each released on their own recognizance Wednesday night, officials with the Hinds County Sheriff's Office said. MDHS released a statement about the arrests. a proud member of the Is there more to be revealed about the diversion of tax money to private schools? Theres a lot of flexibility given for how states use TANF funds. Davis and Smith are accused of fraudulently manufacturing documents to benefit DiBiase using TANF money, White said. Anne McGrew is the accountant for the Mississippi Community Education Center. Davis and Smith created documents and arranged payment knowing DiBiase was not performing the work he was hired to perform, White said. You cant edit our stories, except to reflect relative changes in time, location and editorial style. The agency expects to soon file civil charges against Davis and others who received the funds. 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. Follow him on Twitter @gbolognaCL. A judge in the ongoing welfare embezzlement case is balancing the publics interest in learning how officials misspent tens of millions of federal dollars with a defendants right to a fair trial. A DHS spokesperson rejected the auditors narrative that the department did not disclose fraud reports to the auditors office. We could not cease funding until we had that letter from the state auditor (in January 2020). 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. By clicking submit, you agree to share your email address with Mississippi Today. Zach New, Nancy's son, is the assistant executive director of the Mississippi Community Education Center and is also accused ofusing TANF funds for personal use as well as for investing in private medical device companies. (WLBT) - 3 On Your Side is learning more about how the former head of the Mississippi Department of Human Services ran the agency and treated employees. Davis is accused of creating fake invoices for DiBiase and for "creating a fraud scheme to take TANF funds to pay for personal investments in medical device companies.". She received the National Press Foundations 2020 Poverty and Inequality Award. We moved quickly and quietly in the auditors office to put a stop to the DHS scheme before any more money was taken, and now is the time to use every investigative resource available to uncover all the fraud that remains., The story about the MDHS scandal first broke late Wednesday afternoon, Feb. 5, 2020. The money was stolen from TANF funds, federal money entrusted to the state for needs of the poor. Executive Director John Davis was two-and-half-years into his time as head of the agency when they decided to add an Office of Inspector General within DHS. Here is what we know about them: John Davis was appointed director of DHS by former Gov. "MDHS self-reported the information that initiated this investigation to former Gov. The February 2020 internal report claimed that an employee of 100 Black Men falsified timesheets to pay people who were not working at the nonprofit and that they were using federal money to buy personal items for staff and their family, according to the audit, which did not name the organization. Our stories may appear on pages with ads, but not ads specifically sold against our stories. John Davis, former director of the Mississippi Department of Human Services, was arrested within the largest alleged public embezzlement case in state history. She said its unfair that State Auditor Shad White, who initially investigated the scheme, and current Mississippi Department of Human Services Director Bob Anderson are free to make comments about Davis leadership while Davis is bound by a gag order and unable to respond. "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. The centers director had made a call to her warning her that we were there. Federal authorities and internal investigators at Mississippi Department of Human Services eventually began investigating the subgrantee, 100 Black Men of Jackson, an agency spokesperson told Mississippi Today on Tuesday. If youre not able to add the byline, please include a line at the top of the story that reads: This story was originally published by Mississippi Today and include our website, You cannot republish our editorial cartoons, photographs, illustrations or graphics without specific permission (contact our managing editor. Others doing this kind of thing are on notice: This will not be tolerated now., Former Mississippi Welfare Director Charged With Embezzling Millions, https://www.nytimes.com/2020/02/05/us/john-davis-mdhs-brett-dibiase.html. Sign up for our daily newsletter to get the latest updates on the Mississippi welfare scandal. 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. "MDHS would like to thank the Office of the State Auditor investigators for their diligent work in seeing this investigation through," the post said. Mississippi Community Education Center has also failed to turn over documents the agency needs to complete its forensic audit or conduct a full grant closeout the departments process for ensuring the nonprofit complied with grant requirements and spent the funds properly. Anna has received national recognition for her work, including the 2021 Goldsmith Prize for Investigative Reporting, the 2021 Collier Prize for State Government Accountability, the 2021 John Jay/Harry Frank Guggenheim Excellence in Criminal Justice Reporting Award, the 2020 Al Neuharth Innovation in Investigative Journalism Award and the February 2020 Sidney Award for reporting on Mississippis debtors prisons. After DHS employees reported their findings to the Governor, the State Auditor was notified and the investigation was launched. The matter was referred to the Hinds County District Attorney Office for criminal prosecution after terminating her employment. 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. She explained that she quit due to fear of losing her license and the requirements of the supervisor. What is the extent of the relationship between Tate Reeves and the News, mother and son? The report also said Victory Sports charged a fee for participants in the boot camp to attend and it did not conduct any kind of eligibility to ensure it was serving those in need. As a reminder, the scheme includes more than $4.15 million dollars in embezzled government money. In a statement, the Department of Human Services said it had self-reported the information that initiated this investigation to the governors office in June 2019. Special agents from the office of State Auditor Shad White have arrested John Davis, who retired after 28 years with DHS on July 31 . In the nearly two years after agents first arrested Davis, Whites office has publicized continued findings related to welfare spending and Anderson has made media appearances to discuss changes at his agency as it attempts to restore public trust. Please refresh the page and/or try again. Prevacus, a pharmaceutical company that was working on a concussion treatment and which Favre was a top investor in, also allegedly received $2.15 million in allegedly stolen funds from the scheme, according to Mississippi Today. As a subscriber, you have 10 gift articles to give each month. John Davis, several others face charges, arrested by state auditor's office. As we reported, the Mississippi Community Education Center or MCEC was a sub grantee receiving TANF dollars that first flowed through DHS. Rumor was that some MDHS employees brought the matter to Bryants attention in June, and that Governor Bryant pointed White to the problem. They were among 15 current and former Boston police officers charged in the alleged overtime scheme involving the evidence control unit. You have to credit Mississippi Today. 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. We work to provide free, accessible news for everyone to create a more informed Mississippi and hold public officials accountable. Davis and Smith created documents and arranged payment knowing DiBiase was not performing the work he was hired to perform, White said. DHS went on camera with WLBT to answer questions about what happened and what theyve changed to prevent the problem from happening again. Anderson recently told a reporter that his agency had reinstated the practice of sending letters to subgrantees who are suspected of misusing grant funds, which he said Davis administration had stopped. This spring, Le Creuset has introduced an exciting new shade thats already selling fast: shallot, a soft lavender with pink and slight gray undertones. Please reload the page and try again. Mr. Michel took orders, and millions of dollars, from a Malaysian financier who sought to gain political influence in the U.S., prosecutors said. 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 did reach out to Davis attorney Merrida Coxwell for comment. The scheme came [] Five plead not guilty in MDHS embezzlement scheme - Vicksburg Daily News NEMiss.NEWS was founded in 2014 and is a division of Shivimage, LLC, and began publishing in early 2015. by Anna Wolfe, Mississippi Today December 28, 2021, This and is republished here under a Creative Commons license.. The indictments, which were returned by a Hinds County grand jury, include a range of violations involving fraud and embezzlement, White said in a news release. The organizations executive director, Nancy New, 67, and its assistant executive director, Zack New, 37, were arrested on Wednesday, along with the centers accountant, Anne McGrew, 63, state auditors said. The total amount of money lost to the schemes has not yet been determined but the loss already exceeds any embezzlement scheme in the records of the auditors office, White said. In 2020, officials said the loss exceeds any embezzlement scheme in the records of the Auditors office., You stuck your neck out for me: Brett Favre used fame and favors to pull welfare dollars (Mississippi Today), Phil Bryant had his sights on a payout as welfare funds flowed to Brett Favre (Mississippi Today), 8 revelations from Part 1 of The Backchannel investigation (Mississippi Today), This is a BETA experience. All rights reserved. Copyright 2020 WLBT. Shortly after last year's arrests in the largest reported public embezzlement scheme in state history, a whistleblower disclosed several previously unreported fraud allegations to the welfare department regarding one of its federal grant recipients. Any amount helps us keep producing quality journalism for Mississippi. Theyve also started bringing in subgrantees for training on whats expected and how they can best meet federal guidelines. Since then, the subgrantee process has changed and the state plan for TANF reflects those changes. Wooten said it appears as if the officials are attempting to try Davis case in the media. New is the executive director of Oxford University School. We confirmed that it was John Davis who was making those approvals on the money. According to the auditor's office, there are at least six people involved, though the investigation is ongoing.