Advertisement Former DHS director, wrestler arrested in 'largest public embezzlement case in state history' John Davis, several others face charges, arrested by state auditor's office Share Shares Copy Link Copy

The former director of the Mississippi Department of Human Services and several others have been arrested in what the state auditor said is the largest public embezzlement case in state history.Special agents from the office of State Auditor Shad White have arrested John Davis, who retired after 28 years with DHS on July 31, 2019. Agents also arrested DHS employee Latimer Smith; Dr. Nancy New, owner and director of the Mississippi Community Education Center and New Learning; Zach New, assistant executive director of MCEC; Anne McGrew, accountant for MCEC; and former pro wrestler Brett DiBiase in connection with the multimillion-dollar embezzlement scheme.Tap here for mugshots. The indictments, which were returned by a Hinds County grand jury, include a range of violations involving fraud and embezzlement, White said in a news release."MDHS self-reported the information that initiated this investigation to former Gov. Phil Bryant's office in June 2019. That ultimately led to (Wednesday's) arrests," DHS officials said in a statement. An eight-month investigation revealed that the accused conspired to illegally obtain millions in public funds from the Temporary Assistance for Needy Families program administered by DHS, White said. The defendants used a variety of business entities and schemes to defraud the taxpayers, investigators said. Davis and Smith are accused of fraudulently manufacturing documents to benefit DiBiase using TANF money, White said. Davis and Smith created invoices to pay DiBiase TANF money 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, White said. Davis and Smith created documents and arranged payment knowing DiBiase was not performing the work he was hired to perform, White said. Nancy New and her son, Zach New, stand accused of using the News’ nonprofit, MCEC, to pay for DiBiase’s drug treatment using TANF funds, White said. At Davis’ direction, MCEC used TANF money received from DHS to pay for DiBiase’s opioid treatment at the Rise in Malibu facility, White said. The documentation submitted by the News claimed this was to pay DiBiase for conducting training classes that never, in fact, took place, investigators said. Nancy New and her son are also accused of transferring millions in TANF funds to their private businesses, White said. 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, investigators said. The total amount of money lost to the schemes has not yet been determined but the loss already exceeds any embezzlement scheme in the records of the auditor’s office, White said. Records are kept for all cases from the last 20 years.The suspects were each released on their own recognizance Wednesday night, officials with the Hinds County Sheriff's Office said.