Editor’s note: This story was first published by the Mississippi Center for Investigative Reporting as a follow-up to Mississippi Today’s “The Backchannel” investigation, which examined former Gov. Phil Bryant’s role in the running of his welfare department during what officials have called the largest public embezzlement scheme in state history.
Is the current scandal involving former Mississippi Gov. Phil Bryant encouraging the funneling of millions in welfare funds to family and friends the first time these kinds of allegations have surfaced?
No. In fact, when Bryant worked as state auditor from 1996 to 2003, he demanded reimbursements from officials he claimed had abused funds from the same Temporary Assistance to Needy Families program.
The demands came after allegations arose that millions of welfare dollars went to things such as the purchase of a gold Jaguar and a trip to Greece to study child care.
Donald Taylor, who served as executive director for the state Department of Human Services from 1999 to 2008, recalled other fraud allegations, too, such an employee taking a DHS credit card on his honeymoon to Hawaii.
The way Taylor views it? “My rule is to do the right thing,” he said. “If you have to stop and think about it, it’s probably not the right thing.”
Asked what he thought about the revelations by Mississippi Today of Bryant’s text messages related to the current welfare scandal, Taylor replied, “It staggers the imagination.”
READ MORE: “The Backchannel”: Mississippi Today’s investigation into millions of misspent welfare dollars
According to a forensic audit, the state Department of Human Services misused $77 million while Bryant served as governor and his pick, John Davis, headed the agency. Text messages obtained by Mississippi Today show how Bryant may have wielded influence over Davis’ decisions.
Davis and five others have pleaded not guilty to criminal charges. Bryant has not been charged with any wrongdoing and is credited by State Auditor Shad White as the whistleblower in the case.
While state auditor in 2005, Bryant demanded nearly $221,000 from Claiborne County officials, accusing them of misusing welfare funds. Those allegations included paying $1,000-a-meeting payments to local human resources board members after they were told to stop in 2001.
Five years earlier, just after Bryant took office as auditor, the TANF program paid to transport a woman for nine days from her home in Rosedale to her new job at Grand Casino in Robinsonville.
The cost? $10,744.
That was enough money at the time to buy the woman a Kia Rio, complete with a CD stereo system with subwoofers, rear-window defroster, fuel-injection engine, dual airbags and sunroof — with cash to spare.
When The Clarion-Ledger asked a state senator about this, he replied, “$10,000 in nine days? I’m going to get out of the Legislature and get me a couple of cars.”
In fiscal 2001, Mississippi spent nearly $18 million to aid the impoverished in getting rides to work, but documents showed the program was abused.
The total number of miles reimbursed? More than 16 million miles, or traveling around the world 649 times. In galactic terms, that’s more than halfway to Venus.
By contrast, Arkansas spent less than half on the same program: $7.8 million.
Mississippi allowed nonprofits to charge the program $1.74 a mile — over five times more than the federal government then paid to reimburse employees for their mileage.
In contrast, Arkansas permitted friends and family members to provide transportation, reimbursing them at a rate of 29 cents a mile.
Arkansas and other states also helped the impoverished repair their cars and provided funding to buy used cars.
Robert Cook, who ran the Division of Program Integrity for the state Department of Human Services then, said he regarded his job as a “calling” to ensure monies could go to Mississippi’s most vulnerable. “They are intended for the needy and not the greedy.”
If current allegations are true about “denying benefits to children and mothers and then channeling those benefits to their cronies,” it’s “disgraceful,” he said. “If it in fact did occur like it’s being alleged, then I think every individual along that trail should be held accountable. I don’t think we as a society and as Mississippians should demand anything else.”
When political posturing overtakes common sense or officials pad their cronies’ bank accounts, “we go off course,” he said. “In Mississippi, we can’t afford this. Every dime we waste, there’s a Mississippian suffering somewhere because of that.”
Sandra Shelson, who examined the department’s funding in her work for the attorney general’s office at the time, said TANF dollars have long suffered from a lack of oversight, “but in all of my years, I’ve never seen it abused like this.”
Two decades ago, one problem was Mississippi officials failed to distribute TANF money, Shelson said. “Then and now, the families this money was intended to provide help and a safety net for didn’t receive the benefit.”
She said a false belief has long been promoted of a “welfare queen” clutching a Louis Vuitton bag and driving a Mercedes when the truth is a pittance of money makes it to Mississippi’s most impoverished.
“Parents need child care to go to work,” she said, “but they may not receive vouchers for child care centers, some of which are barely functional.”
These kinds of false beliefs have led state lawmakers to require all of Mississippi’s welfare recipients to submit to regular drug screening, just to receive benefits, she said. “Meanwhile, we’re using the same money to send an ex-wrestler to Malibu for rehab.”
According to an indictment unsealed this week, John Davis, then-director of the state Department of Human Services, schemed with Nancy New, executive director of the Mississippi Community Education Center, used welfare monies to pay for luxury drug treatment for retired wrestler Brett DiBiase.
His wrestling father, Ted, known as “The Million Dollar Man,” is an ordained minister who started the Heart of David ministries, which received more than $3 million in TANF money to “establish a network of partnerships, services and resources throughout Mississippi communities for faith-based and self-help activities.” A forensic audit called the ministries a “high risk” grantee, citing the lack of supporting documentation.
Davis has pleaded innocent to 20 charges, including bribery, that could put him behind bars for nearly 150 years if convicted on all charges.
New and her son Zach have pleaded innocent to 46 charges that could put them behind bars for more than 200 years if convicted on all charges.
Former state Rep. Steve Holland, D-Plantersville, said he warned Mississippi’s top leaders about possible abuse. “Nothing ever came of it that I know of,” he said.
Holland quoting himself as telling then-Gov. Bryant, “Phil, you need to keep a tight watch on this TANF money. There’s not much accountability.”
He quoted Bryant as replying that he was indeed watching the TANF funds, saying, “I used to be auditor.”
Holland called what’s happened “the biggest scandal in the history of the state, and nothing’s being done about it.”