JACKSON, Miss. (WLBT) – The U.S. Government will reveal what it has taken years to piece together beginning next week: Mississippi’s largest public embezzlement scheme and the conspiracy that ensnared nearly a dozen people.
Jury selection for the trial of Ted DiBiase Jr. is set to begin in four days. The former wrestler is the only person indicted in the scandal who decided to fight charges of money laundering, theft, wire fraud, and conspiracy.
DiBiase could still take a plea deal before the trial begins.
Charges and allegations
DiBiase is accused of pocketing nearly $4 million in welfare dollars, concealing the money through fake contracts, and then using that money for his own benefit.
He will walk into a courtroom where every other person connected to this conspiracy has already pleaded guilty, admitted what they did, and decided to help federal investigators fill in the gaps in their investigation.
“It’s much more difficult because everybody else that they’ve pointed a finger at is prepared to show up in court and make the government’s case,” said Matt Steffey, Mississippi College School of Law professor. “If they had no cooperating witnesses, the case is much more difficult [to prosecute]. When it’s just you standing, I think from the outside looking in, it looks hard to defend.”
Key figures in the conspiracy
The only person sentenced for his crimes is former Department of Human Services Head John Davis. A judge sentenced him to 32 years for state charges, but he has yet to be sentenced for his federal crimes.
Davis, the highest ranking individual indicted in the scandal and central figure in the conspiracy, made sure tens of millions of dollars flowed to certain nonprofits which then converted that money for personal use.
Nancy New, head of the nonprofit organization which received most of the welfare money, pleaded guilty to state and federal charges three years ago, but her sentencing remains delayed. Her son, Zach, also pleaded guilty but has not been sentenced. Both have been out on bond since their plea deals.
The News were accused of embezzling millions of dollars in public assistance funds, investing a large chunk of it in private businesses. Funds also went to pay for drug rehab services in California.
Nancy New was the founder of the popular New Summit School in northeast Jackson and was the owner of the Mississippi Community Education Center, a nonprofit responsible for distributing TANF funding to families on behalf of DHS.
Ted DiBiase Jr.’s brother, Brett, pleaded guilty to state and federal charges but has not been sentenced.
Christi Webb, former director of another nonprofit involved in taking the money, also has not received a sentence.
The case for Latimer Smith, a former DHS employee, is under seal and it’s unclear whether that case remains active.
Impact on sentencing
What takes place during the first trial will also determine how those who have already pleaded guilty will be punished.
Steffey said he doesn’t think their fates will hinge on whether DiBiase is convicted.
“I think what matters more is how the prosecutor feels about their level of cooperation,” Steffey said. “If they cooperate in a way that satisfies the prosecutor, even if, for example, the jury hangs or acquits Mr. DiBiase, I would not expect and I would certainly hope it does not have a significant impact on the cooperating witnesses. You know, everybody’s got to do their part. And then we leave the results to somebody else.”
It remains unclear whether any other information sought by prosecutors from cooperating witnesses implicates anybody else to the point where more charges could come.
In the nearly six years since this scandal first became public, text messages and speculation from co-conspirators have suggested that former Governor Phil Bryant and former NFL great Brett Favre could have played a criminal role. But neither individual has been criminally charged, and both have sued media outlets for implying they are guilty.
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