Friday, January 28, 2022

New 46-Count Indictment Hits News

The list of indictments against the News continues to grow.  A Hinds County grand jury returned a 46-count indictment against Nancy New and her son Zach on January 13.   The charges include bribery, conspiracy, embezzlement, fraud, forgery, and racketeering.  The grand jury indicted the News two years ago for embezzlement, conspiracy, and making fraudulent statements.

Nancy New founded the Mississippi Community Education Center and New Learning Resources, Inc.  New Learning Resources operated several schools in Jackson, Oxford, and Greenwood.  The schools served special needs children. New was Executive Director of MCEC and Zach was Assistant Executive Director of the non-profit organization.  

MCEC obtained millions of TANF grant funds from DHS.  However, the indictments allege the News and DHS Director John Davis lined their pockets with millions meant for the poor as part of a racketeering scheme.  The State Auditor arrested the News, John, Davis, MCEC bookkeeper Anne McGrew, Brett Dibiase (Former wrassler and son of the Million Dollar Man), and former DHS employee Latimer Smith after the Hinds County grand jury indicted the defendants in February 2020.  


State Auditor Shad White said in a February 5, 2020 press release:  

Davis and Smith stand accused of fraudulently manufacturing documents to enrich Brett DiBiase using TANF money. Davis and Smith created invoices to pay DiBiase TANF funds for teaching classes about drug abuse, but DiBiase was in a luxury rehabilitation facility for his own drug use in California at the time and did not perform the services. Davis and Smith created documents and arranged payment knowing DiBiase was not performing the work he was hired to perform.

Nancy New and her son, Zach New, stand accused of using the News’ non-profit, MCEC, to pay for DiBiase’s drug treatment using TANF funds. At Davis’ direction, MCEC used TANF money received from DHS to pay for DiBiase’s opioid treatment at the Rise in Malibu facility. The documentation submitted by the News claimed this was to pay DiBiase for conducting training classes that never, in fact, took place.

The News also stand accused of transferring millions in TANF funds to their private businesses. They then converted funds to their personal use and concealed the conversion through various fund transfers, fraudulent documents, at least one forged signature, and deceptive accounting measures.

Finally, Davis and the News are accused of creating a fraud scheme to take TANF funds to pay for personal investments in medical device companies (Prevacus, Inc., and PreSolMD, LLC) in Florida.

 Prevacus and PreSolMD are developing drugs and topical creams to treat concussions.  The companies are in Florida.  Governor Phil Bryant and Southern Miss legend Brett Favre introduced the companies to John Davis while he was Executive Director of DHS Clarion-Ledger article. 

The indictments allege the News invested millions of dollars of TANF funds in the two companies.  

However, the News problems continue to grow as the Hinds County grand jury returned a brand spanking-new 46-count indictment against the News on January 13.  The indictment was unsealed this week.

The new indictments charge the News with 46 counts that include bribery of a public official, embezzlement, conspiracy, conspiracy to defraud state, making false statements to the government, wire/mail fraud, bank fraud, forgery, organized fraud and theft, receiving proceeds from an organized criminal enterprise, and racketeering.  The indictment and a brief description of each offense are posted below. 

The indictments charged the News transferred millions of dollars in grant funds from MCEC to New Learning.  New Learning invested millions in Prevacus and PresolMD or other targets designated by the News. 

The News would need the Director's cooperation to make the alleged scheme work and cooperate he allegedly did. The original Davis indictment states the DHS Director illegally used grand funds to pay for Brett Dibiase's treatment  at a drug rehab facility, Rise in Malibu, in California between November 2018 and  July 2019.  The indictment alleges $48,000 of state funds was paid to Rise for Dibiase through a company, Restore2, LLC.  Dibiase owns Restore2.   Davis stands accused of working with co-defendant Nancy New to pay for the rehab through Restore2. 

The auditors must have uncovered more illegal payments because the indictments accuse the News of funneling $160,000 in welfare funds to Rise in Malibu on behalf of John Davis from February 2019 to February 2020 (Count 26). The News also footed the bill for a first class plane ticket (count 16), chauffeured sedan, and a stay at the Four Seasons Hotel (count 15).  

The Director returned the favor as he approved grant increases of $7.6 million and $3.6 million in 2019.  

 A fraudulent scheme usually requires fraudulent paperwork and this case is (allegedly) no exception. The indictment accuses the News of submitting phony reports to DHS and the State Auditor.  It claims the News forged the signature of Willie Sutton on documents submitted to the state.  In short, much of the indictment accuses the scheme to use MCEC and NRL to pilfer millions of TANF funds as a "criminal enterprise."  The behavior of the News and John Davis (allegedly) fits a pattern of racketeering.   

The case is assigned to Circuit Judge Faye Peterson.  

The Justice Department indicted the News in March 2021 on 17 counts of conspiracy, wire fraud, aggravated identity theft, and monetary transactions with  proceeds of illegal activity involving MDE funds.  The trial is pending. 



Count 1: Nancy & Zach used MCEC to embezzle state grants and invest funds in Prevacus and PresolMD. 

Count 2: News embezzled $750,000 in state funds. Nancy transferred funds from MCEC to company she owned, New Learning Resources.  The funds were then invested in Prevacus in January 2018. 

Count 3: Transferred $500,000 to Prevacus using the same method described in Count 2. 

Count 4:  Transferred $250,000 to Prevacus in May 2019

Count 5: Transferred $400,000 to Prevacus in July 2019

Count 6: Transferred $100,000 to Presol in September 2019

Count 7: Transferred $150,000 to Presol in October 2019

Count 8: Transferred $2.15 million to Presol and Prevacus in January 2019. 

Count 9: Nancy New, Zach New, Anne McGrew, John Davis, and others conspired to embezzle grant funds received by MCEC from September 2018 to October 2019. 

Count 10: News embezzled $2 million.  Transferred funds and converted to own use. 

Count 11: News gave $40,000 to John Davis to pay for Rise in Malibu, a rehab center.  Davis increased their grant funds by $3.6 million in February 2019.

Count 12: News made same payment in March 2019.  He increased grant funds by $7.6 million in June 2019. 

Count 13: News made same payment in April 2019.   

Count 14: News made same payment  in June 2019. 

Count 15:  Paid $790 for John Davis to use Four Seasons Hotel in California. 

Count 16: Paid $1,107 for first class flight to California for tickets and $238 for chauffeured sedan. 

Count 17: Bribery.  Davis increased grants to MCEC by $7.6 million in June 2019 in exchange for payments. 

Count 18: News submitted false claims to DHS for $1.656 million. 

Count 19: Diverted $2.15 million in grant funds to Prevacus and Presol MD in October 2018. 

Count 20: Forged signature of William Sutton on documents provided to State Auditor in November 2019.  News lied that a valid written agreement existed between MCEC and New Learning Resources when MCEC transferred $700,000 to NLR.  

Count 21: News submitted phony docs to state for the $7.6 million increase so they could funnel more grant funds to the two Florida companies. 

Count 22: News defrauded DHS of $4.8 million in grant increase.  Paid bribes to John Davis and funneled funds to two Florida companies. 

Count 23:Submitted phony documents in October 2019 that fraudulently reported how grant funds were spent. 

Count 24:  Submitted phony subgrant expenditure report in December 2019. 

Count 25: submitted a phony "Certification of Subgrant Compliance" to DHS in December 2019

Count 26: Paid $160,000 to Rise in Malibu with TANF funds from February 2019 to February 2020. 

Count 27: Invested $2.15 million in TANF funds in Prevacus and PresolMD from January 2019 to October 2019. 

Count 28: The News embezzled $1.656 million from January 2019 to October 2019. 

Count 29: Wired $40,000 to Rise in Malibu for John Davis in February 2019. 

Count 30: Same payment in March 2019. 

Count 31: Same payment in April 2019

Count 32: Same payment in June 2019. 

Count 33: Invested $750,000 in grant funds in Prevacus. 

Count 34: Invested $500,000 of grant funds in Prevacus in April 2019. 

Count 35: Invested $250,000 in Prevacus in May 2019

Count 36: Invested $400,000 in Prevacus in July 2019

Count 37: Invested $100,000 in Prevacus in September 2019

Count 38: Invested $100,000 in Presol in September 2019

Count 39:  Delivered phony documents and financial  statements from October 2018 to June 2019

Count 40: Submitted phony documents to State Auditor and DHS from June 2019 to February 2020

Count 41: The News engaged in a pattern of racketeering from September 2018 to February 2020 with John Davis and Anne McGrew.  

Count 42: The News engaged in a pattern of racketeering to acquire ownership interests in PresolMD and Prevacus from September 2018 to February 2020. 

Count 43: News received "proceeds" from a pattern of racketeering activity.  

Count 44: News engaged in a pattern of racketeering activity from September 2018 to February 2020. 

Count 45: News organized and conducted a fraud enterprise from September 2018 to February 2020 for the purpose of stealing TANF funds for their own use.  They wired stolen funds across state lines to Rise in Malibu in California as well as PresolMD and Prevacus in Florida. 

Count 46: Repeats Count 45. 




Anonymous said...

How is it even possible for one person to do so much fraud?

Anonymous said...

@12:23 ask that Coleman guy

Anonymous said...

First it was the News, now we have the Colemans What is it with these Greenwood fraudsters?

Anonymous said...

12:23 : Crazy right ? This seems more like a scare tactic than something they actually have a case for.

Anonymous said...

Way to big to be just one person !

Anonymous said...

Two names
Mpower ms
AFP - ms

Anonymous said...

They can use those topical creams in prison.

Anonymous said...

Low hanging fruit for a DA seemingly incapable of growing his own.

Anonymous said...

Explain your clues ? I know of both organizations but have never heard either mentioned in this. Thanks Management.

Anonymous said...

Haha. What a reach. The DA gets denied for another continuance request, and drops this. It reeks of desperation. If the entire situation wasn’t so sad, it would be comical. Jody Owens and Co. better strap in. He’s hitched his wagon to Shad’s case and will be made the scape goat if this thing doesn’t go his way.

Anonymous said...

@12:40 I think you misinterpreted 12:23. Scare tactic? Who are they scaring? What are they scaring them for? Is this the new “if they really had a case, they would have gone to court already” deflection tactic? Didn’t take long for that one to pop up again.

Anonymous said...

So Anne McGrew is apparently saying whatever the State wants her to say….wonder if John Davis has cut a deal too? Gotta be more than relying on McGrew and Brett DiBiase as star witnesses. Good luck with that. Personally, I hope the News go all the way through a trial and spill the beans on this situation. There’s no way they are in this alone, even if they have done something wrong. Forgive me if I don’t go with the court of public opinion on this one. This thing hasn’t added up from day 1. There’s gotta be more to it. Expose them all!!

Anonymous said...

I too think some of you are close……the DA is worried and wants this case to go away.

Anonymous said...

I hope they eventually start looking at funds being funneled from other divisions/programs, too. I denied an expense once and was told my program was “discretionary” and the agency could spend the money however they wanted. That’s not what discretionary means in this sense. Also, while I was there (2019) there was a big push for other divisions outside of TANF to partner with Families First, AKA: apply for grant funds that could be funneled to Nancy’s group. There are so many people involved, knowingly and unknowingly. JD was an authoritarian and I personally believe a lot of DHS staff were afraid to speak up. But, I can empathize because many of them had been there for years and losing that 13th check/being blackballed from state employment is scary.

Anonymous said...

These guys get hit with 46 new counts and some of you dumbasses on here are acting like that’s a good thing for the defendants. I guess that’s because they are such good people.

Anonymous said...

Wow, this is all news to me.

Anonymous said...

What's a deppity feel?

Anonymous said...

If they’re being accused of bribery and conspiracy, wouldn’t John Davis have to be accused and indicted as well. Has he cut a deal?

Anonymous said...

lol @ 2:43

Anonymous said...

Long way to conviction. If found guilty, community service at their ages. Being a state case.

Anonymous said...

Need to round up all the DHS Deputy Directors, they knew this shigity was wrong!!! John Davis didn’t do this by himself! Need to get everyone this passed thru.

John was the Executive Director and did not do this all by himself! Impossible!

Sing, John sing, don’t go down by yourself!

If you need me to put some money on your book for commissary, just tell me where the rest of the money is hidden! You will need money for necessities like ramen noodles, socks, underwear.

You, Need to know prison slang, “Mexican got boots on” , means the Mexican prisoners are going to riot cause they are wearing boots in the yard and not sneakers. They will kick and stab their adversaries.

Just tell me who the other MDHS players are John, do go down alone.

Anonymous said...

Not a lawyer here.... but I would think if you're looking at spending the rest of your life in prison, you're going to make a deal and spill the beans on some high-level folks. You legal eagles have an opinion?

Anonymous said...

12:38 PM Greenwood has a culture of fraud going back generations. The News and Colemans are the current generation. The Delta culture is to get millions from the state and federal government and then scream socialism if someone uses food stamps at the grocery store. Check out the history of P.L. Blake, Dickie, and others in Greenwood.

Anonymous said...

@3:38 he has been charged with other things. Not sure if accepting bribes is in there… yet, but that wouldn’t constitute RICO charges for him. He’s still in trouble, just not RICO charges.

Anonymous said...

@4:22.. you have got to be joking. Zach is in his 30s. And Nancy is in her 60s. Do you actually believe they will get community service for RICO charges involving this much money? They stole money intended for the most needy and took advantage of families and children with significant needs, differences and disabilities. They used rehab centers as bribery and washed their money in various other business ventures. (Undoubtedly all created with the goal of saving the community and the children). Community service??! Isn’t that what they were supposed to be doing in the first place? You know, serving the community and being good stewards of the money. They are going away for a long, long time. It may take awhile to get them there because of our speedy justice system and politics, but the only community service they will ever perform again is when they enter that jail cell and never enter our community again.

They would watch the world burn and dance around the flames if it made them a dollar.

Anonymous said...

Who were the Attorneys assigned by the Attorney General’s Office that support and work for MDHS, they are just as CULPABLE as John Davis!

I know they pled ignorance and weren’t aware, a bunch of bullshit! They review all contracts, especially million dollar contracts.

John tell on their asses!

Anonymous said...

@8:02 Jacob Black for one. Andrea Sanders for two. Plenty more to add to the list. This entire case is being kept at a very superficial level. The News are taking all the heat. When they finally talk, I’m betting we learn something very different. The question is, will the facts matter to those who have been condemning them for 2 years?!

Anonymous said...

@2:29 denial is a powerful thing…

Anonymous said...

@9:06 for once, you are a bystander I can agree with. As someone that was directly and personally involved with this company, I can assure you that whatever heat they receive.. they deserve Dante’s Inferno. Also, let’s take a moment to point out the fact that the gag order applies to the public and media.

They are not barred from speaking to the authorities or their legal council. PLEASE stop saying we are waiting for what they have to say to come out. What is this big news? That someone higher up was involved? I’m sure that hasn’t ever happened before. And they are free to present that defense before trial.

All of these people preaching about “waiting for the truth to come out”, the News were “set up” and they weren’t alone …. Ok..AND? Does any of that make them innocent. If someone orders a hit, but I pull the trigger.. am I not guilty?

But I digress. I more specifically want to know to which facts you are referring? The fact that they misled 99.9% of their employees about the work that they were doing. The fact that they paid several people with TANF funds to work exclusively for their privately owned business? That they “allegedly” defrauded the state out of money that was earmarked to help schools serve the kids with the highest level of need? That they allowed their staff to continue working, knowing they couldn’t pay them? That they paid themselves above market value rent on their buildings? That they forged documents? That they are good people?

Please enlighten us.

That they accidentally transferred a few million dollars to various investment endeavors that benefited them?

There's That Dot Connector Again.. said...

1) Someone asked.."Who were the Attorneys assigned by the Attorney General’s Office that support and work for MDHS, they are just as CULPABLE as John Davis!"

Oh, really? Remember that Epps guy over at Department of Corrections? Well, seems the Asst Attorney General assigned to Epps later married Epps' confidant and memo-writer. The three of them were a triumvirate for years. In fact, Epps gave the bride away at the altar. I'm not so sure we can infer from this that Davis' state-employed attorney has any culpability. Nor is it suggested that Epps' (state) attorney shares any guilt with Epps.

2) No way in hell Nancy New along with an alcoholic wrestler (or any ONE other person) is 'smart enough' to weave this entire web. Everybody involved in organized crime does not wear a fedora and carry a violin case.

3) Meanwhile, connect these dots:
Brett Favre is a famous graduate of Southern Miss.

Our most-recent, previous governor and his wife are both well-known graduates of Southern Miss.

Brett Favre benefited handsomely from this ripoff of welfare money. The jury, as it were, is still out on his repayment.

Our most recent, previous governor's family was remarkably close to Miz New, having appeared numerous times with Miz New on TV and in the print media, at social events and various gatherings around the state.

Southern Miss. was gifted a really nice volley ball court and building using the stolen 'New-Family Welfare Money' under the shallow guise of providing a facility for poor and disadvantaged women. Bryant and Favre celebrated and high-fived this structure on campus.

The president of Southern Miss., a week ago, abruptly announced his resignation with two years left on his contract. He stated no reason but said he looks forward to a new chapter in his life.

Anonymous said...

6:49 am

Dot connextion

Interesting but not conclusive to me.

The USM president is stepping down in 18 months…..not a huge rush.

Once civil discovery begins and people start pointing fingers the truth will come out.

Right now we know there was an enormous heist that went to friends of those connected….and we know religion was once again bastardized to amass personal financial gain and some cocaine.

It’ll be interesting to watch and see how Davis explains his marching orders.


Anonymous said...

12:44 - You did more than digress when you suggested a judge can place or enforce a gag order 'on the public' at large or 'media'. This blog is a medium which is a part of media and those commenting here are 'the public'.

Anonymous said...

6:49 am, just thinking you maybe correct, the Attorneys for the AG’s office assigned to MDHS my not be culpable. They thought it was business as usual!

I say its sad, you have multi million dollar contracts and have attorneys on hand for this purpose and not a nary one saw anything ( red flags) WRONG.

I say it’s blatant acts of I won’t get caught! Personal needs overpower the intent of monies for the poor and needy.

My I note, we do have some Great hard working Assistant Attorneys Generals. Just not with DHS at that time!

Business as usual all for the good of my people!!!

Anonymous said...

After 10 years in this place Dr. Bennett probably just had enough. He will find another better paying job if he wants one before the moving van shows up.

Anonymous said...

@10:18… put your readers on. They cannot speak to the media or public about the case.

Anonymous said...

7:29 PM They will never spend even one night in prison.

Anonymous said...

9:35...I didn't say Bennett is 'suddenly leaving'. I said he 'abruptly announced'. And with two years left on his contract.

Name one positive thing he has done for the University of Southern Mississippi.

Anonymous said...

So, what is happening with Latimer Smith? Is he still charged? Is he talking? Does anyone know? Did he just follow the boss' order?

Anonymous said...

Who TF is Latimer Smith? Sounds like a Jimmy Stewart character.

Kingfish said...

If you haven't noticed, most fraud cases don't go to trial. There is a good reason for that. Usually there is a paper trail in black and white. If the indictments are to be believed, auditors traced grant funds from DHS to MCEC to New Learning or other conduits. The money was then traced to investments, purchases, and other transfers. There are specific regs for grants.

In this case, I suspect the News will show or attempt to show they were told to make these transfers by others such as the Director or the man who appointed him. The meeting between the Florida guy and Davis is rather curious and it will be interesting to see what comes out about it at trial.

Anonymous said...

Audit should have caught it earlier and stopped it. Instead he simply watched it.

Anonymous said...

Auditor appears to have indicted, then investigated. Risky business right there……the question is WHY?

Anonymous said...

Anyone else still bufuzzled how Phil Bryant could be reported to be the whistle blower?!

Anonymous said...

@11:41 who do you think it is??

Anonymous said...

Shad: "Hello. Shad White. May I help you?

Phil: "Shad, Phil here. What's up, man?"

Shad: "What's rockin' Guv, you durin' OK?"

Phil: "Well, I think I fucked up gettin' hooked up with this New woman."

Shad: "I can help. Chill."


Does this count as 'whistle blowing'?

Anonymous said...

Me thinks the only reason this case hasn’t gone to trial is because of Phil Bryant’s involvement with the concussion drug. Don’t forget he was wining and dining those folks before DHS involvement, a fact he so conveniently “forgot” early on.

Anonymous said...

KF 1/30 @ 8:01. Your statement includes “IF THE INDICTMENTS ARE TO BE BELIEVED”. Do you really not see the problem with that statement ? For two solid years all we’ve heard is “guilty guilty guilty”. And now we’re gonna start all over again ?
Seems to me if the indictments were to be believed, they would have had plenty of rope to hang them with already and it would be over. Every “what if …..” has an opposite ….. what if the indictments are NOT true ….. and peoples’ lives have been ruined ? No, I am not a family member, just a bystander who has seen over-zealous prosecutors do what they do too many times in the past. Also, the longer this thing goes on, seems to me it’s not really about the News (as I said before, they could already be convicted if the indictments are to be believed). Two years later, it’s about something / somebody else.
Just a well thought-out opinion, and many agree with me.

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