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Welfare Agency Sues Brett Favre, 37 Others Over Millions in Mississippi TANF Funds

a photo of Brett Favre's face up close
NFL Hall of Famer Brett Favre is among 38 people named in a civil lawsuit that the Mississippi Department of Human Services filed Monday as it seeks to reclaim millions in misspent welfare funds. AP Photo/Rogelio V. Solis, File

The Mississippi Department of Human Services is suing 38 people, including NFL Hall of Famer Brett Favre and retired WWE Wrestler Ted DiBiase Sr., in an effort to recoup millions in misspent welfare funds that should have gone to needy families. 

The civil lawsuit stems from a massive welfare fraud scheme involving former MDHS officials, the operators of several Mississippi nonprofits and other alleged beneficiaries of the misspent Temporary Assistance For Needy Families money.

“Today, we are filing suit on behalf of the people of Mississippi to begin to recoup funds that were improperly used and diverted from their important purpose of helping families in need,” Mississippi Gov. Tate Reeves and Attorney General Lynn Fitch said in a statement on Monday. “… Our purpose with this suit is to seek justice for the broken trust of the people of Mississippi and recover funds that were misspent.”

The lawsuit demands $23.3 million from John Davis, the former MDHS head who now faces 20 felony counts for his role in authorizing over $77 million in illegal TANF spending through non-profits run by Nancy New and son Zach New, from whom the state seeks $19.4 million and $2.1 million, respectively. 

The state is also demanding $19.4 million from the News’ nonprofit Mississippi Community Education Center and $6.5 million from the private-school company they ran, New Learning Resources Foundation Inc. 

Prosecutors have accused Davis of illegally funneling money into the News’ nonprofits through Families First Mississippi, an MDHS-sanctioned program.

‘We Knew This Day Would Eventually Come’

The state is suing Brett Favre for $3.2 million and his company, Favre Enterprises, for $1.1 million. Starting in 2017, the famed quarterback and Mississippi native received $1.1 million in funds from the News’ nonprofit organizations to give speeches that Mississippi State Auditor Shad White said he never gave. Favre paid the state back part of the money, but still owed $228,000 late last year.

State auditor shad white stands in front of an American flag
“I applaud the team filing this suit and am grateful the state is taking another step toward justice for the taxpayers,” Mississippi State Auditor Shad White said. Photo courtesy Shad White

In 2017, the year Favre began receiving the payments, MDHS confirmed to The Clarion-Ledger that it had approved just 167 out of 11,717 applicants for Temporary Assistance For Needy Families funds the prior year. A ThinkProgress investigation found that the 1.42% acceptance rate was the lowest in the nation.

Favre has repeatedly ignored requests for comment from the Mississippi Free Press, but said in October 2021 tweets that he “would never accept money for no-show appearances, as (White) claims” and that he was “doing all that I can to support this investigation to make things right for the people of Mississippi.”

The auditor also said late last year that former WWE wrestler Ted DiBiase Sr., known popularly as “The Million Dollar Man,” owed $722,299 that his Christian ministry had received from the misallocated funds. White said his sons, retired WWE wrestler Ted DiBiase Jr. and WWE wrestler Brett DiBiase, also owed the state money. 

The auditor referred the DiBiases, Favre, the News, Davis and others to Mississippi Attorney General for civil proceedings in November 2021.

“When we issued our civil demands related to the DHS scandal last fall and then turned those demands over to the attorney general’s office for enforcement, we knew this day would eventually come,” White said in a statement Monday. 

“I applaud the team filing this suit and am grateful the state is taking another step toward justice for the taxpayers. We will continue to work alongside our federal partners—who have been given access to all our evidence for more than two years—to make sure the case is fully investigated.”

Another sports celebrity named in the lawsuit is former football player Marcus Dupree, who the state says owes $371,000. MDHS is also suing the Marcus Dupree Foundation for the same amount.

Six Indicted in Welfare Case

Davis, the former DHS head, is among six people who prosecutors have indicted in the case. The News have both pled guilty to bribery and fraud charges. Last year, DHS employee Latimer Smith accepted a plea agreement. 

The others indicted in the case include DHS employee Latimer Smith, who pleaded not guilty to state charges over the DHS scandal; Brett DiBiase, who accepted a plea agreement to become a witness in the case; and Anne McGrew, Nancy New’s former accountant at the Mississippi Community Education Center, who pleaded guilty as part of a plea deal in exchange for testimony.

Nancy New shakes hands with Phil Bryant while John Davis stands behind them
Former Mississippi Gov. Phil Bryant (right) appointed former Mississippi Department of Human Services Executive Director John Davis (center), who prosecutors say illegally funneled millions in Temporary Assistance For Needy Families dollars through nonprofits owned by Nancy New (left). Photo courtesy Families First for Mississippi

Authorities have not accused or charged others with criminal wrongdoing in the case.

Former Mississippi Gov. Phil Bryant had close ties to Nancy New and he celebrated the launch of Families First For Mississippi with her in 2016. After Mississippi Today’s Anna Wolfe reported recently on the former governor’s communications with figures involved in the MDHS scandal, the NAACP asked the U.S. Department of Justice to open a federal investigation into the former governor’s possible involvement.

Bryant denied knowledge of the scheme in an interview with Wolfe and has faced no charges and is not part of the current lawsuit.

Monday’s civil suit includes a demand for Prevacus, a pharmaceutical company, to return $2.1 million it received in illegal TANF funds from MDHS. Wolfe previously reported that Bryant and Favre sought to bring the company to Mississippi. Prosecutors have not accused Bryant, Favre or Prevacus of any criminal wrongdoing.

 

Before news of the scandal broke, the News gave thousands to Republican campaigns in Mississippi, including to current Gov. Tate Reeves. In 2019, Reeves’ campaign filmed a campaign ad at the News’ private school in Jackson, New Summit, touting his support for public education. He has since returned their donations and renounced the mother-son duo. 

Neither White nor prosecutors have alleged that the current or former governor were involved in the scheme.

In March, federal prosecutors indicted the News on additional charges, alleging that Nancy and Zachary New “conspired” to “fraudulently” obtain more than $2 million in public education funds and used it to pay for teachers’ salaries at New Summit School in Jackson. The News’ schools have been among the top recipients of legal public-education funds under a private-school voucher program that Reeves, as lieutenant governor and Senate president, helped create and which Bryant signed into law.

‘Correcting The Path Of MDHS’

MDHS Executive Director Bob Anderson addressed the lawsuit in a statement on Monday, saying that “Governor Tate Reeves tasked me with correcting the path of MDHS.”

“As part of that process, MDHS has been working hard to restore trust and put in place numerous internal controls to ensure that misspending is not repeated in the future,” he said. The rest of the task involves recovering and returning to the taxpayers the millions of dollars in misspent funds which were intended to benefit Mississippi’s needy families. We begin that task today with the filing of this civil complaint.

Tate Reeves sits at a desk in front of the Mississippi state seal with Attorney General Lynn Fitch next to him, the two standing between an American flag and Mississippi state flag
“Our purpose with this suit is to seek justice for the broken trust of the people of Mississippi and recover funds that were misspent,” Mississippi Gov. Tate Reeves (left) and Attorney General Lynn Fitch (right) said in a joint statement. Photo courtesy Gov. Tate Reeves

“This is our initial complaint, as in any civil suit, as discovery proceeds, we anticipate that additional parties and additional claims may be added or changed as the matter moves forward.”

You can examine the lawsuit here for more information on the 38 individuals named in the MDHS lawsuit and the state’s allegations.

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