Mother and son plead guilty to Mississippi welfare spending

JACKSON, Miss. (AP) — A mother and son who ran a nonprofit group and education business in Mississippi pleaded guilty on Tuesday to charges of misusing state funds intended to help some of the poorest people in the country.

Nancy New and Zachary New have admitted spending social grant money on lavish gifts, including first-class airline tickets for John Davis, executive director of the state Department of Human Services from 2016 to 2019.

Nancy New, 69, and Zachary New, 39, agreed to testify against others in what the state auditor called Mississippi’s biggest public corruption case in the past two decades. Davis is among those charged by the state.

Federal and state prosecutors said after Tuesday’s hearing that they had not ruled out bringing charges against others, but two state judges issued restraining orders for those involved in the cases. to discuss it publicly.

“We will not tolerate the powerful preying on the weak,” Hinds County District Attorney Jody Owens said.

Auditor Shad White said his office continues to work with federal and state prosecutors.

“We’ll provide whatever they need, we’ll get whatever they need when they make decisions about what happens next in this case,” White said.

During the trial, Circuit Judge Faye Peterson asked Zachary New and Nancy New, individually, if they understood each charge. They each responded repeatedly, “Yes, ma’am.”

The mother and son ran the nonprofit Mississippi Community Education Center, which received millions of dollars from Temporary Assistance to Needy Families and was supposed to spend it to help the poor. Nancy New was president and Zachary New was vice president of operations for New Learning Resources Inc., which operated three private schools providing services for children with autism or dyslexia.

In early 2020, Davis, Nancy New, Zachary New and three others were charged in state court, with prosecutors saying welfare money was misspent on things like drug rehab in Malibu, in California, for former professional wrestler Brett DiBiase.

New indictments recently filed against Davis state that he hired DiBiase for a position in the Department of Human Services, knowing that DiBiase did not meet the requirement to have a college degree; and that the department paid DiBiase $48,000 for work he didn’t do. Davis pleaded not guilty to all charges.

Nancy New and Zachary New’s state guilty pleas came days after they pleaded guilty in federal court to charges related to misspending education dollars. Nancy New pleaded guilty to federal wire fraud, which carries a 10-year sentence and a $250,000 fine. Zachary New pleaded guilty to federal conspiracy, which carries five years and a $250,000 fine.

Peterson said she would defer their state sentencing until after the Nov. 9 federal sentencing. The mother and son, who both live in the Jackson suburb of Ridgeland, remain free on bail.

On the charges against the state, Nancy New faces up to 100 years in prison after pleading guilty to four counts of bribery, two counts of fraud against the government, six counts of wire fraud and one count of racketeering.

Zachary New faces up to 75 years after pleading guilty to four counts of bribery, two counts of fraud against the government and five counts of mail fraud.

Prosecutors could recommend shorter sentences, and Owens said he recommends the entire time be served in federal prison.

Davis was a longtime Department of Human Services employee who was chosen to lead the agency in 2016 by then-Republican Gov. Phil Bryant.

The state auditor has demanded reimbursement of $77 million in misused social funds, including $1.1 million paid to retired NFL quarterback Brett Favre, who lives in Mississippi. Favre has not been charged with any criminal act.

White said Favre was paid for speeches but did not show up. Favre repaid the money, but White said in October that Favre still owed $228,000 in interest. In a Facebook post when he repaid the first $500,000, Favre said he was unaware the money he received came from social funds. He also said his charity has provided millions of dollars to poor children in Mississippi and Wisconsin.

As part of guilty pleas on Tuesday, Nancy New and Zachary New admitted to having a hand in spending $4 million in welfare for a volleyball facility at the University of Southern Mississippi. Favre supported the construction of this facility. The mother and son also admitted to donating welfare funds to Prevacus Inc., a Florida-based company trying to develop a concussion drug. Favre has stated in interviews that he supports Prevacus.

Copyright © 2022 . All rights reserved. This website is not intended for users located in the European Economic Area.

Comments are closed.