Mississippi Welfare Scandal: Audit Shows Luxury Cars Among $94 Million in Questionable Spending

A 104-page audit of the Mississippi Department of Human Services exposed spending not being used for the purposes the money was earmarked for, according to USA Today.

Money that was meant to assist poor residents was used to purchase luxury cars, sponsor a college baseball tournament, and encouraged nepotism by hiring family members of a top state official, according to a report from State Auditor Shad White.

The audit, which was released earlier this week,  shows how federal welfare grant funds flowed from DHS into two nonprofit groups, which allegedly spent money in inappropriate or questionable ways.

In a written statement, White said the report “shows the most egregious misspending my staff have seen in their careers at the Office of the State Auditor.” He continued, “If there was a way to misspend money, it seems DHS leadership or their grantees thought of it and tried it.”

White said his office will forward the information it found to the U.S. Department of Health and Human Services, which oversees the welfare program. He said this could lead to cuts in the Temporary Assistance for Needy Families (TANF) allotments or other sanctions placed on the state.

The audit found these items questionable:

• The two nonprofit groups used welfare money to hire lobbyists, often without paperwork describing the work they were supposed to do.
• One of the groups, Mississippi Community Education Center (MCEC), gave contracts to, and hired, family members of former Department of Human Services Director John Davis, sometimes making lump-sum payments. The payments and salaries to his nephew and brother-in-law totaled more than $1 million over the past several years, auditors said.
• Both nonprofit groups gave welfare money to a trio of wrestlers, Ted DiBiase, Ted DiBiase, Jr., and Brett DiBiase—some of it for work never performed, some for “unreasonable” travel costs.
• MCEC paid Victory Sports Foundation with welfare money to run fitness programs, some of which Mississippi legislators and other officials or staffers participated in, free of charge. The trainer who runs Victory said he did not know he received welfare money.
• MCEC bought three cars with welfare money, each worth more than $50,000, for Nancy New, the head of MCEC, and two sons. Salaries, cellphones, and other expenses were paid using welfare money. The vehicles included a 2018 Nissan Armada, a Chevrolet Silverado, and a Ford F-250. In each case, the vehicle was registered to MCEC, but in each case, auditors said the vehicles were for personal use.
• MCEC used welfare money for sports-related purposes, including sponsoring a college baseball tournament and other NCAA events.
• MCEC cut a $3,000 check to a bookkeeper of MCEC, though a handwritten note says “$3,000 cash was given to” Davis, the DHS executive director.
• MCEC moved $6 million to a private school and organization run by New and bought supplies for the school.