Home Career Reeves justifies USM’s exclusion from the welfare claim

Reeves justifies USM’s exclusion from the welfare claim

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Gov. Tate Reeves explained Thursday that his office, not the independent counsel hired to handle the case, used an “objective process” to choose who would face charges in a massive state civil lawsuit that seeks to recover millions in misspent funds. social security.

The lawsuit, with many caveats, excluded the University of Southern Mississippi’s athletic foundation, which the welfare chief and his attorney originally intended to sue.

Reeves, who was accused of political cover in recent days for the dismissal of the private attorney who filed the suit, said the state limited its complaint to people and companies who received payments that a third-party audit firm characterized as “wasteful, fraudulent and abusive” in the narrow sense Report for October 2021 or who have been subject to criminal prosecution.

“We should have an objective process by which we determine who gets sued. Knowing that, we can add any party in the future,” Reeves said Thursday during a news conference at the Neshoba County Fairgrounds, his first public comments since he was accused of firing a lawyer to protect the USM Athletic Foundation and other politically connected players . . . . The only exception in the lawsuit that we have right now that was not included in the ‘waste, fraud and abuse’ category that we sued for is Prevacus. And the reason for that is that on at the time of filing the lawsuit, one of the participants in the conspiracy was being criminally charged.”

But like Prevacus, a pharmaceutical company backed by retired NFL quarterback Brett Favre, payments to the University of Southern Mississippi’s athletic foundation were also the subject of a criminal indictment and plea. The governor’s office ordered the Department of Social Security to eliminate the USM Athletic Foundation, whose board includes several Reeves donors, from its original civil complaint before its filing.

Reeves’ statement also does not address this fact forensic auditors found $12.4 million in “waste, fraud and abuse” but the civil suit seeks $24 million in damages, saying the defendants deviated from the program’s “statutory goals and squandered them for enrichment.”

Still, the state, at least so far, has chosen not to use a civil lawsuit to investigate one of the most egregious schemes in the scandal: the use of 5 million dollars of social assistance for the construction of a volleyball stadium at the University of Southern Mississippi.

In fact, the Social Security Administration, which Reeves oversees, fired the attorney who built the case, former U.S. Attorney Brad Piggott. for this. Reeves initially approved that his director of welfare, Bob Anderson, hire Piggott for a one-year contract that ends July 31.

Another paradox in Reeves’ explanation of how they chose people and purchases for the lawsuit is that retired NFL quarterback Brett Favre was not included in the medical examiner’s report or criminal charges, but he was named as a defendant in the civil lawsuit .

READ MORE: Gov. Tate Reeves says fired lawyer in Social Security scandal had ‘political agenda’ and wanted media attention

The governor’s administration asked Thursday afternoon for an explanation of the process for selecting the defendants and sent a statement that said: “It was decided at that time, based on the large amount of evidence surrounding Prevacus that was presented in the criminal indictment, that a limited exception would be made ( for those entities and individuals associated with Prevacus) in the general policy to follow “fraud, embezzlement and abuse” as revealed by the forensic examination. There were many other subjects who were questioned and/or included in the indictments that may be added in the future.”

The lawsuit does not limit Favre’s investigation to the Prevakos deal; it also includes $1.1 million in welfare payments he received for public speaking engagements that officials say he never gave — expenses that were never detailed in the “waste, fraud and abuse” report cited by Reeves .

Favre sought funding from the state of Mississippi to support Prevacus. Just weeks after Favre and Prevacus founder Jake Vanlandingham first offered Gov. Phil Bryant campaign shares to put him “on the team” in late 2018, they began receiving stolen Social Security funds for their experimental drug projects that resulting in more than $2 million. The text messages were discovered by Mississippi Today revealed that Bryant had agreed to take the company package two days after leaving office, but the arrests forced him to renege on the deal.

“We have also taken into account sensitive points regarding the criminal investigations on which it would be inappropriate to comment further,” the governor’s statement continued.

Forensic auditors also noted in the reports that they were limited in what they could review, preventing them from drawing conclusions in the report about “waste, fraud and abuse” of roughly $40 million in spending by the nonprofit Mississippi Community Education Center, including payments to the sports fund and Favre.

“There are certain facilities that are in question, and the auditor’s office said they don’t have enough information to determine whether or not there was waste, fraud and abuse,” Reeves said Thursday. “And the reason they didn’t have enough information to determine that is because some entities, like the MCEC, because of the criminal case, didn’t want to cooperate with the forensics. So there are many entities outside of “waste, fraud and abuse” that could be added in the future. For this reason, by the way, most often in such situations, the civil case comes after the criminal one.”

Forensic auditors said they were limited in the number of emails they could review and were unable to obtain documents not only from the Mississippi Community Education Center but also from the State Auditor’s Office, which as the original investigating agency had many of the relevant documents.

Some of the defendants in the civil suit asked for a stay of proceedings to allow the criminal trial to be completed before proceeding with the civil proceedings.

“The new defendants have accepted responsibility for their role, but they continue to be caught in the crossfire of powerful forces fighting for political futures and tens of millions of dollars. The state wants to avoid liability and embarrassment, the feds want their money back, and the public wants answers,” New’s attorney Jerry Bufkin wrote in a motion to stay on behalf of New’s nonprofit Community Education Center of Mississippi.

A hearing on that motion is set for Aug. 17, and based on Reeves’ comments, it appears the state may support that route.

Several other entities that have received funds have been classified as embezzlement, fraud and abuse — such as Through the Fire Ministries, a Christian organization founded by a musician Deborah Bryant spoke – were not included in the civil lawsuit. The Ministry received 25 thousand dollars. Other organizations named in the medical examiner’s report that were not included in the lawsuit received less than $25,000.

Warren, Washington, Isaken, Sharkey Community Action Agency (WWISCAA), the defendant in the civil action, settled the lawsuit for just $49,190.

Lobaki Inc., another company in which criminal defendants have pleaded guilty to defrauding the government in order to cough up hundreds of thousands of dollars in Social Security benefits, is also not involved in the civil suit.

MDHS originally announced shortly after receiving the forensic audit, the agency indicated it would sue both the sports foundation and Lobkey, but then the governor’s office began its “objective process.”

When Piggott began seeking information about the volleyball scheme, the largest known purchase in the $77 million welfare scandal, the state abruptly removed him from the case.

The volleyball project began in 2017 when Favre began seeking support for a new athletic facility at his alma mater, where his daughter played volleyball. He was listened to by Bryant and welfare officials John Davis, MDHS director at the time, and Nancy New, the operator of a nonprofit organization that began receiving unexpected federal grants from the department.

The federal government prohibits states from using the money, a block grant called Temporary Assistance for Low-Income Families, on bricks and mortar, so officials devised a scheme to hide the true nature of the payment by calling it rent. The nonprofit pretended that a $5 million lease with the athletic foundation would allow it to provide services to underprivileged people. Nancy New’s son, Zach New, pleaded guilty to wire fraud in the scheme. The agreement was signed by the Higher Educational Institutions and the General Prosecutor’s Office, according to the minutes of the IHP board meeting.

A separate report from the same auditors described a $5 million payment from the Mississippi Community Education Center to the USM Athletic Foundation as prohibited by federal regulations.

To examine everyone involved, Pigott subpoenaed the sports foundation to speak with several key people, including Bryant, his wife, Deborah Bryant, and Favre. At the same time, Piggott also subpoenaed conservative radio station Supertalk for interviews with key defendants in the case, who often appeared on the show to promote their work.

The administration did not like the direction Pigott took.

“It appears that the lawyer that DHS initially hired wanted to go beyond who fell into that category (waste, fraud and abuse) for the purposes of this lawsuit,” Reeves said. “It looked like a particular lawyer had a political agenda.”

As for the volleyball scheme itself — which could send Zach New to prison — Reeves questioned the legality of the spending.

“…while they may not have been reasonable expenses, or they may not have been expenses that I would have approved, the question is whether they were legitimate or whether they were wasteful, fraudulent and abusive. If they were fraud and waste abuse, we sued,” Reeves said. “…I don’t know all the details of how this (volleyball stadium) came about, all I know is that it doesn’t sound like an expense that I would personally support with TANF dollars.”

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