Mississippi Today
Welfare agency settles with eight defendants in fraud lawsuit
More than two years into the litigation, the state of Mississippi has agreed to settle with eight defendants in the ongoing welfare fraud civil case for a total of about $750,000.
That’s roughly half as much as the state has spent on legal fees in the case so far.
The eight defendants, who allegedly illegally received or were liable for the misspending of a total of $1.7 million, did not admit to wrongdoing. Their settlements represent some of the smaller components of the overall welfare fraud scheme. The future repayments amount to less than 1% of the total $79 million in federal welfare funds that Mississippi Department of Human Services’ lawsuit claims were lost to malfeasance.
The defendants, date and amount of settlement, and total alleged damages are as follows:
- Chase Computer Services, August 2024, $1,000 out of $375,750
- Southtec, August 2024, $10,000 out of $19,000
- Lobaki, April 2024, $300,000 out of $795,000
- Williams, Weiss, Hester & Company, April 2024, $220,000 out of an undetermined amount
- William Longwitz and Inside Capitol, March 2024, $318,325 out of $318,325
- Rise Luxury Rehab, October 2023, $105,000 out of $160,000
- Warren Washington Issaquena Sharkey Community Action Agency, January 2023, $49,190.06 out of $49,190.06
Each of these companies received funds from the federal Temporary Assistance for Needy Families block grant, or TANF, from the two private nonprofits – Mississippi Community Education Center and Family Resource Center of North Mississippi – running a program called Families First for Mississippi. The program operators, who received as much as $40 million a year, were supposed to channel resources to help stabilize poor families and prevent child neglect but instead frittered the funds away on contracts with politically connected companies.
Mississippi Department of Human Services said it could not comment on the settlements due to Hinds County Circuit Court Judge Faye Peterson’s suppression order in the case, which has prevented parties from discussing the situation publicly. Defendants who have been released from the case are no longer bound by the gag order, and representatives of virtual reality tech firm Lobaki agreed to share their story with Mississippi Today in a piece published in April.
“We didn’t know the difference between TANF and a frickin’ turnip patch, you know?” Lobaki President Kevin Loud said at the time.
Will Longwitz, a former Madison County Court Judge, state senator and legislative lobbyist currently working as a personal injury lawyer in New Orleans, settled with MDHS in March for the total amount of TANF funds auditors say he received – $318,325.
The lawsuit alleged the nonprofits hired Longwitz’s firm Inside Capitol to lobby lawmakers on behalf of Families First, though federal regulations prohibit the use of TANF funds for lobbying activities. He registered as a lobbyist for MCEC in 2018 but reported receiving no compensation from the nonprofit, despite the six-figure income. He also reported spending zero on food, gifts or entertainment for public officials.
MCEC hired four other lobbyists during the time of the scandal, but it paid Longwitz by far the most – nearly $320,000 compared to between $21,000 and $72,000 for each of the others. The lawsuit alleged Longwitz knew the money he received came from the welfare fund.
Longwitz, who represented himself in the litigation, denied the allegations, repeating legalese and referring to himself as a releasee in an email to Mississippi Today Monday. “Releasees specifically and categorically deny any and all liability with regard to all claims and allegations, and settle the claims only to buy their peace and avoid further cost of defense,” he wrote.
Longwitz agreed to a monthly payment schedule and will have until 2033 to pay the entire amount.
Only one other defendant, Warren Washington Issaquena Sharkey Community Action Agency (WWISCAA) settled for the total amount of damages, $49,190.06, that MDHS alleges it caused. The original May 2022 lawsuit accused the nonprofit of failing to perform the services, such as academic tutoring and career skills development, it was hired to provide. Emails Mississippi Today previously obtained suggested that the organization’s partnership with Families First was a sham.
“They were absolutely doing nothing in either center,” said a social worker who was employed under the program, according to an email.
WWISCAA’s January 2023 settlement denied any wrongdoing and its director Jannis Williams declined to comment.
The Greenville-based Community Action Agency was founded in 1972 as one of the local nonprofits across the nation tasked with administering federal anti-poverty funds, primarily the Community Services Block Grant. Throughout its recent legal battle, WWISCAA seems to have maintained its normal partnership with Mississippi Department of Human Services, receiving roughly $5 million a year from the welfare agency.
In the settlements so far, Chase Computer Services, owned by Christopher Scott Chase, received the best deal by dollar amount.
MDHS claimed the nonprofits hired the tech company to develop software to track outputs and performance of the Families First program, but that it never provided the service, and it should repay the agency $375,750.
The company denied the allegations. The parties settled for just $1,000 last week. According to his LinkedIn page, Chase has worked as a senior developer at the Tupelo-based American Family Association since 2023, and the Chase Computer Services website says it is no longer accepting new clients. Chase did not respond to an email from Mississippi Today.
The lawsuit similarly accused Southtec of not completing all of the work – installing internet network and phone systems in Families First offices – that it was prepaid to conduct. MDHS claimed Southtec caused $19,000 in damages related to overages on a hotspot that it was using on Family Resource Center’s dime. They settled for $10,000 this month.
The vendor whose welfare payments raised some of the first red flags in the welfare fraud investigation – Rise Luxury Rehab – settled with MDHS back in October. For four months in 2019, former MDHS Director John Davis instructed Mississippi Community Education Center to pay $40,000 a month for his friend Brett DiBiase to be treated at the luxury rehab facility in Malibu. The company agreed to pay back $105,000 of the total $160,000 it received. Its lawyer did not return an email.
MDHS had alleged in the lawsuit that Williams, Weiss, Hester & Company, the accounting firm in charge of auditing Mississippi Community Education Center’s finances, had completed a “bogus” audit in 2017 that concealed the nonprofit’s use of TANF funds.
The lawsuit asked for damages, which would have been determined at trial, totaling the amount of the nonprofit’s misspending that the agency would have allegedly caught if the firm had performed a proper audit. MDHS settled with the accounting firm in April for $220,000.
In an emailed statement to Mississippi Today, firm owner Doug Hester maintained that his company had not committed professional malpractice.
“Unfortunately, obtaining vindication in a lawsuit of this magnitude with this many parties is extremely expensive and time consuming, so WWH made a business decision to settle the case and buy its peace rather than continue with a lengthy and expensive court battle,” Hester wrote.
Mississippi Community Education Center, its founder Nancy New, and her son Zach New also filed their own lawsuit against Williams, Weiss, Hester & Company in 2021 claiming that they relied on the accounting firm to ensure the nonprofit was spending its funds properly and that the accounting errors caused the News to be charged criminally. The News dropped the case in February.
Judge Peterson signed orders dismissing Chase Computer Services and Southtec from the case last week. She dismissed Lobaki and Williams, Weiss, Hester & Company from the case in April. Warren Washington Issaquena Sharkey Community Action Agency was removed from the lawsuit when the state filed its amended version in December of 2022. The court file does not yet contain orders of dismissal for William Longwitz, Inside Capitol, or Rise Luxury Rehab.
Mississippi Department of Human Services has paid Jones Walker, the law firm bringing the litigation, nearly $1.5 million in TANF funds since 2022, according to the state’s public accounting database. The stated purpose of the lawsuit is to clawback the misspent TANF funds.
Thirty-eight defendants remain, including Brett Favre and the University of Southern Mississippi Athletic Foundation, who together allegedly worked to channel $5 million in welfare funds to build a volleyball stadium on the college campus. They’ve also denied wrongdoing.
MDHS claims Favre is also on the hook for $2.1 million that the New nonprofit funneled to pharmaceutical companies that he sponsored. An alleged co-conspirator in that scheme, Jake Vanlandingham, pleaded guilty to a federal wire fraud charge last month.
Some of the defendants facing the biggest alleged damages, such as Davis and nonprofit operators Nancy New and Christi Webb, have already pleaded guilty to criminal charges related to the scheme and will likely have to pay restitution for their crimes.
This article first appeared on Mississippi Today and is republished here under a Creative Commons license.
Mississippi Today
On this day in 1972
Nov. 16, 1972
A law enforcement officer shot and killed two students at Southern University in Baton Rouge after weeks of protests over inadequate services.
When the students marched on University President Leon Netterville’s office, Louisiana Gov. Edwin Edwards sent scores of police officers in to break up the demonstrations. A still-unidentified officer shot and killed two 20-year-old students, Leonard Brown and Denver Smith, who weren’t among the protesters. No one was ever prosecuted in their slayings.
They have since been awarded posthumous degrees, and the university’s Smith-Brown Memorial Union bears their names. Stanley Nelson’s documentary, “Tell Them We Are Rising: The Story of Black Colleges and Universities,” featured a 10-minute segment on the killings.
“They were exercising their constitutional rights. And they get killed for it,” former student Michael Cato said. “Nobody sent their child to school to die.”
In 2022, Louisiana State University Cold Case Project reporters, utilizing nearly 2,700 pages of previously undisclosed documents, recreated the day of the shootings and showed how the FBI narrowed its search to several sheriff’s deputies but could not prove which one fired the fatal shot. The four-part series prompted Louisiana Gov. John Bel Edwards to apologize to the families of the victims on behalf of the state.
This article first appeared on Mississippi Today and is republished here under a Creative Commons license.
Mississippi Today
Gloster residents protest Drax’s new permit request
GLOSTER — Drax, the United Kingdom-based wood pellet producer that’s violated air pollution limits in Mississippi multiple times, is asking the state to raise the amount of emissions it’s allowed to release from its facility in Gloster.
In September, the state fined Drax $225,000 for releasing 50% over the permitted limit of HAPs, or Hazardous Air Pollutants, from its facility Amite BioEnergy. In a pending permit application that it submitted to the Mississippi Department of Environmental Quality in 2022, the company is seeking to transition from a “minor source” of HAPs to a “major source.”
A “major source” permit would remove the limit over the facility’s total HAP emissions, but it would apply a new limit over the rate at which Drax could release the pollutants.
This year’s fine was its second penalty for violating Mississippi law around air pollution limits. In 2020, the state fined the company $2.5 million for releasing over three times the legal threshold of Volatile Organic Compounds, or VOCs, one of the largest such fines in state history. Drax underestimated its VOC releases since the facility opened in 2016, but didn’t realize it until 2018. The facility didn’t come into compliance until 2021.
The Environmental Protection Agency lists a variety of potential health impacts from exposure to HAPs, including damage to the immune system and respiratory issues. VOCs can also cause breathing problems, as well as eye, nose and throat irritation, according to the American Lung Association.
For years since Drax’s violations became public, nearby residents have attributed health issues to living near the facility. During a public hearing on Drax’s permit request Thursday in Gloster, attendees reiterated those concerns.
“We all experience headaches every day,” resident Christie Harvey said about her and her grandchildren. Harvey said she has asthma too, and her doctor was “baffled” by her symptoms. “Each week I have to take (my grandchildren) to the clinic for upper respiratory issues … It’s not fair that we have to go through this. Drax needs to lower the pollution as much as possible.”
Part of the public outcry is the proximity of people’s homes to the plant, which is within a mile of Gloster’s downtown.
“The wood pellet plant in Lucedale is situated in an industrial park outside of town,” Andrew Whitehurst of Healthy Gulf, an environmental group dedicated to protecting the Gulf of Mexico’s natural resources, said at the meeting. “The wood pellet plant that (Enviva is) trying to put in Bond will be situated north and west of the downtown area. Not like this when it’s right smack in the middle (of the city). It’s totally inappropriate. People can’t take it, they don’t deserve it.”
In a statement to Mississippi Today, Drax said it prioritizes the public health and environment in Gloster, adding that the permit modification is a part of standard business practice.
“When we first began operations, some of our original permits were not fit for purpose,” spokesperson Michelli Martin said via e-mail. “We are now working to acquire the appropriate permits for our operating output and to improve our compliance. Within these permits the requirements may change based on engineering data and industry standards. This permit modification is part of our ongoing plan to provide MDEQ with the most accurate data. Drax fully supports the resolution of our permitting request and looks forward to working with MDEQ to finalize the details.”
While researchers, including from Brown University, are studying the health symptoms of residents near the wood pellet plant, there is no proven connection between the facility’s emissions and those symptoms.
Erica Walker, a Jackson native who teaches epidemiology at Brown and who’s leading the study, spoke to Mississippi Today earlier this year. Regardless of the cause and effect, she said, the decision to put the plant near disadvantaged communities with poor health outcomes is concerning.
“We want to make sure we aren’t additionally burdening already burdened communities,” Walker said.
About 1,300 people live in the city, according to Census data, and 39% live below the poverty line.
Moreover, Gloster residents often have to travel hours, to cities such as McComb and Baton Rouge, to find the nearest medical specialist. Amite County, where Gloster is, has a higher rate of uninsured residents than the rest of the state, according to County Health Rankings, and the ratio of residents to primary care physicians is over three times greater in the county than Mississippi as a whole.
As part of its application, Drax is seeking a Title V permit under the Clean Air Act, which the EPA requires for major sources of air pollutants. This gives the EPA the opportunity to review Drax’s application and public comments submitted with it. The public can submit comments on the application until Nov. 26, and can do so through MDEQ’s website.
The Mississippi Environmental Quality Permit Board, which is made up of officials from several state agencies, will then decide whether or not to grant the new permits. A full overview of the process and Drax’s application is available online.
This article first appeared on Mississippi Today and is republished here under a Creative Commons license.
Mississippi Today
Mississippi receives ‘F’ rating on preterm birth rate
Mississippi received an F grade for its rate of preterm births in 2023 – those occurring before 37 weeks gestation – from the 2024 March of Dimes report card.
Mississippi’s preterm birth rate was 15%, the worst in the country. Any state with a rate greater than 11.5% also received an F. The U.S. average was 10.4%.
Preterm births in Mississippi have risen steadily over the last decade, increasingly nearly 2% since 2013. In Jackson, the state capital, nearly one in five babies are born preterm, according to the report.
“As a clinician, I know the profound impact that comprehensive prenatal care has on pregnancy outcomes for both mom and baby,” Dr. Amanda P. Williams, interim chief medical officer at March of Dimes, said in a press release. “Yet, too many families, especially those from our most vulnerable communities, are not receiving the support they need to ensure healthy pregnancies and births. The health of mom and baby are intricately intertwined. If we can address chronic health conditions and help ensure all moms have access to quality prenatal care, we can help every family get the best possible start.”
In addition to inadequate prenatal care, factors such as smoking, hypertension, diabetes and unhealthy weight can cause people to be more likely to have a preterm birth.
The report highlighted several other metrics, including infant mortality – in which Mississippi continues to lead the nation.
In 2022, 316 babies in the state died before their first birthday. Among babies born to Black mothers, the infant mortality rate is 1.3 times higher.
The state’s maternal mortality rate of 39.1 per 100,000 live births is nearly double the national average of 23.2.
Mississippi has yet to expand Medicaid – one of only 10 states not to do so – and tens of thousands of working Mississippians remain without health insurance. It also has not implemented paid family leave, doula reimbursement by Medicaid, or supportive midwifery policies – all of which March of Dimes says are critical to improving and sustaining infant and maternal health care.
The Legislature passed a law last session that would make timely prenatal care easier for expectant mothers, but more than four months after the law was supposed to go into effect, pregnant women still can’t access the temporary coverage.
“March of Dimes is committed to advocating for policies that make healthcare more accessible like Medicaid expansion, addressing the root causes of disparities, and increasing awareness of impactful solutions like our Low Dose, Big Benefits campaign, which supports families and communities to take proactive steps toward healthy pregnancies,” Cindy Rahman, March of Dimes interim president and CEO, said in a press release.
This article first appeared on Mississippi Today and is republished here under a Creative Commons license.
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