For the first time since news of Mississippi’s $77 million welfare scandal first broke in 2020, a judge has sentenced one of its conspirators, even as six others await sentencing. Hinds County Circuit Court Judge Adrienne Wooten sentenced accountant Anne McGrew, 69, to one year in prison on Monday. After her release, she will also serve four years under house arrest.
“I can’t believe I’m going to jail,” Mississippi Today reported McGrew saying Monday as an officer placed her in handcuffs to await transfer to prison. “I didn’t do anything wrong.”
In 2021, McGrew pleaded guilty to one state charge of conspiracy to commit embezzlement as part of a plea agreement to testify against other defendants. She told the court that as an employee of the Mississippi Community Education Center, she assisted nonprofit operator Nancy New and her son, Zach New, in moving funds from MCEC to bank accounts owned by New Learning Inc., a for-profit company the News owned.
The scandal ensnared then-Mississippi Department of Human Services Director John Davis, who used his power as the state’s welfare chief to direct welfare funds, including federal Temporary Assistance for Needy Families funds that should’ve gone to the state’s poorest, to an array of illicit causes. That included directing millions in funds toward sports celebrities like retired NFL quarterback Brett Favre, whom prosecutors have not charged with a crime. Davis often funneled the funds through New’s nonprofit and another nonprofit organization.
In court on Monday, Mississippi Today reported that McGrew said she covered for New because “I thought we were doing some good.”
“We served the community. We helped kids, and I thought that was worthwhile,” McGrew said.
Mississippi State Auditor Shad White’s office began investigating the welfare scandal in the summer of 2019, after then-Gov. Phil Bryant, who appointed Davis, alerted him to a tip from former MDHS Deputy Director Jacob Black about suspicious activity at the department. He announced the initial arrests in February 2020 along with Hinds County District Attorney Jody Owens.
“The first person was sentenced to prison today in the welfare fraud scheme that my office uncovered over six years ago,” White said in a statement Tuesday. “My understanding from prosecutors is that the court will be sentencing the other six people who pleaded guilty soon. Our court system often takes time to function, but today it took a step toward justice for the taxpayers who were defrauded in the largest public fraud scheme in state history.”
Hinds County District Attorney Jody Owens, who faces his own unrelated criminal trial this summer, said that McGrew received nothing in exchange for the scheme, but was still responsible for her role as an accountant for MCEC, WLBT reported. But he has credited her for helping investigators understand how the massive welfare scheme went down.
The sentencing for McGrew, who was among the first people charged with crimes in the welfare scandal in early 2020 alongside Davis, was delayed while investigators worked to either secure plea agreements with other defendants or until other cases went to trial. The only charges that have gone to trial, however, were federal charges against retired pro-wrestler Teddy DiBiase Jr. Davis testified in his trial, admitting that he directed millions toward the wrestler in a bid “to buy all your love.” But in March, a jury found DiBiase not guilty on all charges.
Multiple defendants who have pleaded guilty in the case still await sentencing, including Davis, retired pro-wrestler Brett DiBiase (the brother of Teddy DiBiase Jr.), Nancy New, Zach New, Prevacus founder Jake Vanlandingham and nonprofit operator Christi Webb. Prosecutors dropped charges against Latimer Smith, an MDHS employee who was among the first charged, in 2022.
