State Auditor: Former DHS director, five others arrested in largest public embezzlement case in state history

They allegedly conspired to illegally obtain millions in public funds from the Temporary Assistance for Needy Families program administered by DHS, according to the State Auditor’s Office.

Posted: Feb 5, 2020 6:30 PM
Updated: Feb 21, 2020 10:22 AM

JACKSON, Miss. (WTVA) - Special agents with the State Auditor’s Office arrested six people, including the former director of the Mississippi Department of Human Services, in connection with a multi-million dollar embezzlement scheme.

The arrestees are:

(Top L-R): Davis, N. New, DiBiase | (Bottom L-R): Smith, McGrew, Z. New

  • John Davis, the former director of the Mississippi Department of Human Services (DHS)
  • Latimer Smith, former DHS employee
  • Dr. Nancy New, owner and director of the Mississippi Community Education Center (MCEC) and New Learning, Inc.
  • Zach New, assistant executive director of MCEC
  • Anne McGrew, accountant for MCEC
  • Brett DiBiase, the son of former professional wrestler Ted DiBiase

They allegedly conspired to illegally obtain millions in public funds from the Temporary Assistance for Needy Families (TANF) program administered by DHS.

They used a variety of business entities and schemes to defraud taxpayers, according to the State Auditor’s Office. 

The total amount of money has not been determined, according to the State Auditor’s Office, but the amount will be a record for the state office.

The following paragraphs are from the Auditor Office's Wednesday press release.

"Davis and Smith stand accused of fraudulently manufacturing documents to enrich Brett DiBiase using TANF money. Davis and Smith created invoices to pay DiBiase TANF funds 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. Davis and Smith created documents and arranged payment knowing DiBiase was not performing the work he was hired to perform.

Nancy New and her son, Zach New, stand accused of using the News’ non-profit, MCEC, to pay for DiBiase’s drug treatment using TANF funds. At Davis’ direction, MCEC used TANF money received from DHS to pay for DiBiase’s opioid treatment at the Rise in Malibu facility. The documentation submitted by the News claimed this was to pay DiBiase for conducting training classes that never, in fact, took place.

The News also stand accused of transferring millions in TANF funds to their private businesses. 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.

Finally, Davis and the News are accused of creating a fraud scheme to take TANF funds to pay for personal investments in medical device companies (Prevacus, Inc., and PreSolMD, LLC) in Florida."

Mississippi Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 61125

Reported Deaths: 1711
CountyConfirmedDeaths
Hinds5209106
DeSoto328027
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Washington148032
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Sunflower90622
Lafayette8699
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Pike82632
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Leake76725
Lincoln74339
Wayne73221
Pontotoc7247
Simpson71126
Monroe69750
Coahoma65910
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Covington57811
Winston57115
Marshall5668
George5415
Union51913
Newton51611
Attala49524
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Pearl River48236
Walthall44218
Chickasaw43519
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Claiborne40013
Smith37713
Jasper3758
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Clay36814
Alcorn3544
Prentiss3376
Hancock32614
Tishomingo3163
Yalobusha31610
Lawrence3135
Itawamba30710
Tippah30412
Clarke29825
Montgomery2913
Humphreys26911
Tunica2656
Carroll24511
Greene22611
Kemper22315
Perry2217
Quitman2211
Amite2105
Jefferson Davis1986
Webster19712
Jefferson1916
Wilkinson18712
Sharkey1801
Stone1483
Choctaw1264
Benton1240
Franklin1142
Issaquena211
Unassigned00

Alabama Coronavirus Cases

Confirmed Cases: 89927

Reported Deaths: 1580
CountyConfirmedDeaths
Jefferson11650225
Mobile8998191
Montgomery6198143
Madison493225
Tuscaloosa391263
Baldwin317522
Shelby300232
Marshall294730
Unassigned263351
Lee249140
Morgan220615
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DeKalb167713
Elmore158437
Calhoun15359
Walker145763
Houston130912
Dallas128023
Russell12201
Franklin118420
Limestone118313
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Cullman111311
Colbert107612
Lauderdale105312
Autauga101020
Escambia96515
Talladega89013
Jackson8163
Chambers81438
Tallapoosa80478
Dale77619
Butler75135
Blount7223
Covington70420
Coffee7035
Chilton6976
Pike6547
Barbour5625
Lowndes54624
Marion53524
Marengo51514
Clarke4849
Hale44925
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Perry4284
Winston42811
Wilcox4029
Monroe3884
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Washington31011
Macon30813
Lawrence3060
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