Former Mississippi Welfare Chief Pleads Guilty In Multimillion-Dollar Fraud Scandal

Topline

The former head of the Mississippi Department of Human Services pleaded guilty Thursday to improperly doling out millions of dollars in welfare funds in one of the largest public corruption cases in state history, a scheme that allegedly involved former football star Brett Favre, who has not been charged.

John Davis, former director of the Mississippi Department of Human Services, leaves the Thad Cochran … [+] United States Courthouse in Jackson, Miss., Thursday, Sept. 22, 2022.

Key Facts

Director John Davis pleaded guilty to conspiracy to commit wire fraud and theft, after the Department of Justice said he and his co-conspirators “fraudulently obtained and misused federal funds” for their “personal use and benefit,” including funds from the Temporary Assistance for Needy Families and Emergency Food Assistance programs.

Prosecutors said under Davis’ leadership, the state Department of Human Services gave federal funds to two non-profits, and pushed them to sign sham contracts with “various entities and individuals” and hand out payments for services that weren’t provided.

Davis was originally indicted in state court, but an agreement filed Wednesday showed his state criminal charges were dropped on the condition that he plead guilty to federal charges and testify against others in the case, according to NPR.

The DOJ said Davis conspired with four other people who were not named, two of whom are allegedly executive directors of organizations and one of whom is allegedly the owner of two companies, NPR reported.

What To Watch For

Davis, 54, will be sentenced on February 2. The wire fraud charge carries a maximum penalty of 5 years, and the theft count carries a maximum of 10 years in prison.

Key Background

Davis was charged in state court in 2020, along with defendants including former wrestler Ted DiBiase and Nancy New, the head of one of the non-profits that was given federal money. New and her son, who worked at the organization, have since pleaded guilty. In May, the state of Mississippi sued Favre, DiBiasi and several other people for their purported ties to the scandal, claiming they “squandered” over $20 million in welfare funds for needy families. Favre allegedly requested that New and her organization give him millions of dollars in welfare funds to build a volleyball court at his alma mater, the University of Southern Mississippi, where his daughter plays the sport. New and Favre were connected by Former Mississippi Gov. Phil Bryant, according to purported text messages published by Mississippi Today. Favre was also allegedly paid over $1 million to promote a program called Families First, and a pharmaceutical company that he invested in was allegedly given millions in funds intended for welfare programs, with text messages showing Favre and the company’s founder offered New and Bryant shares of the company in exchange for their help. Favre has insisted he didn’t know the money paid out for Families First and for the volleyball facility came from welfare funds, and said in 2020 he would repay the fees he received for promoting Families First. Meanwhile, the Mississippi lawsuit alleged the “Million Dollar Man” wrestler DiBiase—who ran a charitable group—was given money for first-class travel, a luxury rehab stay for one of his sons and other misuses.

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What To Watch For

Key Background

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