Mississippi Today
WWE wrestler fights new federal indictment in welfare scandal, which his attorney calls ‘armchair quarterbacking’
WWE wrestler fights new federal indictment in welfare scandal, which his attorney calls ‘armchair quarterbacking’
Former WWE wrestler Ted “Teddy” DiBiase Jr. was sitting on the front row behind former Mississippi welfare director John Davis while the now disgraced government bureaucrat testified before Congress in 2019.
Davis, who was at the time admittedly orchestrating a stunning welfare fraud scheme, was telling members of the U.S. House of Representatives Committee on Agriculture about the supposedly life changing work his department was conducting instead of making food assistance available to more Mississippians.
“We know that it takes investment in our staff through things like Law of 16,” Davis told congress members, “which is our personal and professional development programs for our staff members, to then replicate that over with our clients to make sure that they are empowered to be whom they have been called to be.”
Law of 16 was DiBiase Jr.’s nebulous motivational speaking series, one of the projects for which he received roughly $3 million in federal welfare funds from Temporary Assistance for Needy Families (TANF) and The Emergency Food Assistance Program.
Today, nearly four years after the director spoke openly in the nation’s capital about his work, DiBiase Jr. is facing criminal charges for the first time within the larger unfolding welfare scandal, in which officials stole or misspent tens of millions of federal public assistance funds.
He pleaded not guilty and if convicted on all counts in the indictment unsealed Thursday, DiBiase Jr. faces a maximum penalty of up to 175 years in prison.
“It was the government that chose to run this program this way. And it was not a secret. This was done in front of everybody. It was done in front of the United States Congress. This was not a secret. This was not, as the federal law would say, a scheme or artifice to defraud,” Scott Gilbert, DiBiase Jr.’s criminal defense attorney, told Mississippi Today two weeks ago. “So what we’re doing now, for the most part, is second guessing and armchair quarterbacking the way government was run. And that’s not what the criminal law is for.”
This indictment, handed down by a federal grand jury, is the first that the U.S. Attorney’s Office has secured in the welfare case. Each of the other five federal defendants pleaded guilty to bills of information, which are used when a defendant chooses to plead guilty without the case going to a grand jury.
READ MORE: The Backchannel Series
DiBiase Jr. joins his younger brother Brett DiBiase, who also received hundreds of thousands in welfare funds, to become the eighth person to be charged criminally within the scandal, including those only charged in state court. DiBiase Jr., his brother and their father, former WWE star Ted “The Million Dollar Man” DiBiase, are all facing civil charges in a parallel lawsuit Mississippi Department of Human Services has filed against nearly four dozen people or organizations. DiBiase Sr. has not faced criminal charges.
Under the new indictment, DiBiase Jr. faces 13 criminal counts under Title 18 of the U.S. Code, the main criminal code of the federal government, ranging from conspiracy, wire fraud, theft of federal funds and money laundering.
“It’s ironic that he was involved with the Law of 16, a questionable program at best, because he’s now going to get familiar with the Law of 18, which is Title 18 of the U.S. Code,” quipped current Mississippi Department of Human Services Director Bob Anderson, a former prosecutor tapped by Gov. Tate Reeves to lead the welfare agency after the scandal broke in 2020.
Anderson has said he is cooperating with the federal authorities in their ongoing investigation for his entire tenure at MDHS.
“I believe they will do everything to bring all additional charges they think are appropriate in this case,” he added after DiBiase Jr.’s arraignment Thursday.
Prosecutors say DiBiase Jr. secured at least five “sham contracts” in 2017 and 2018 with two nonprofits, Mississippi Community Education Center and Family Resource Center of North Mississippi, who were receiving tens of millions of federal welfare funds to run a statewide anti-poverty initiative called Families First for Mississippi. The directors of those nonprofits, Nancy New and Christie Webb, have both pleaded guilty within the scheme.
Davis and DiBiase Jr. met after the director initially hired his younger brother, Brett DiBiase, in an executive level position at MDHS in 2017, despite him lacking qualifications for the job. Davis became close with the DiBiase brothers, first Brett and then Teddy. Their communication reflects a familial relationship in which they discussed their faith, hardships, and told each other, “I love you.”
Davis retired from office in mid-2019, shortly after the D.C. trip, after his deputy, Jacob Black, who is facing his own charges in the parallel civil suit, brought a tip of suspected fraud to former Gov. Phil Bryant. In the months leading up to his ousting, Davis expressed concern that his relationship with DiBiase Jr. had weakened.
“I hate that you feel that way,” DiBiase Jr. wrote to Davis in a March 2019 text message. “… You definitely don’t have to ‘chase’ after me … Just want you to know I love you dearly, and I’m so grateful for your friendship.”
In its civil suit, MDHS alleges DiBiase Jr. “exploited his close relationship with John Davis to further enrich his family and friends.”
Under Davis’ direction, the nonprofits made up front payments to DiBiase Jr. “regardless of whether any work had been performed and knowing that no work likely ever would be performed,” the new indictment alleges.
The nonprofits hired DiBiase Jr. to perform vague services — such as leadership outreach, addressing the needs of inner city youth and assessing the need for emergency food assistance — with little requirement of outcomes.
But according to audit reports, interviews and a review of communication, Davis frequently required DiBiase Jr. to accompany him in his day-to-day executive meetings and tasks, interrupting DiBiase Jr.’s duties under the contract.
“It’s just sort of bizarre to think of the executive director of the Department of Human Services actually conducting himself on a regular basis in ways that thwart and interfere with the ability of the contractor to do the work. But that’s exactly what went on, on a regular basis,” Gilbert said.
“You’ve got a guy who’s here that’s trying to perform and do what he’s supposed to do, and to a large extent he does,” Gilbert said. “And then you’ve got this person running MDHS that for whatever reason feels like the best use of Teddy’s time is not to perform his contracts, but to follow him around to meetings and to other events and things like that. And it just, it’s nonsensical. … I don’t know of anybody that understands really what that was about other than just, it’s just pure absurdity.”
The indictment alleges that the money that went to DiBiase Jr. “were diverted from needy families and low-income individuals in Mississippi.”
However, states have long legally diverted funds from the national Temporary Assistance for Needy Families program away from families in need. Since welfare reform in the 90’s, when TANF was created, states have used the lax guidelines in federal statute to shrink the side of the program that provides monthly cash assistance, known as the welfare check, and put the money instead into other programs or pet projects.
Even today, Mississippi’s welfare agency uses only about 5% of its TANF block grant on the welfare check.
While the other TANF programs are supposed to serve one of three other goals — promoting job preparation and marriage, preventing out-of-wedlock pregnancies and encouraging two-parent families — the federal government provides virtually no oversight to ensure that the programs supported by these funds actually correspond with these goals.
In the case of the Mississippi welfare scandal, which involves officials using $5 million in TANF funds to build a volleyball stadium at University of Southern Mississippi, the spending had become especially egregious.
The indictment alleges DiBiase Jr. used the federal funds he received to buy himself a vehicle and a boat and to put a down payment on a roughly $1.5 million lakeside home in the Madison community of Reunion, which the federal government has since seized.
Gilbert is confident the federal government doesn’t have a viable case against his client. He says there are several problems with the prosecution’s legal theory. In the welfare fraud case, prosecutors have used a specific theft or bribery statute, 18 U.S. Code § 666, which applies to agents of an organization or agency that receives federal funds obtaining funding by fraud. Two of DiBiase Jr.’s 13 counts fall under this statute. Gilbert said his client cannot be charged with this crime since he was not an agent of an organization that received federal funds. He makes the distinction that because DiBiase Jr. was a contractor under the nonprofit, not the state agency, he was never an agent of the federal funds.
Gilbert also contests the government’s claim that DiBiase Jr.’s contracts were a “sham.” DiBiase Jr. did conduct work under the contracts, Gilbert said, and any work he did not conduct was as a result of Davis’ interference.
“The big issue from a criminal defense perspective is: Did someone obtain money or property from the government by being dishonest? And what I can tell you in this case is, these contracts, the work that was done, I’ve yet to see a single shred of evidence that would show that Teddy DiBiase was dishonest with anybody about anything in order to get these contracts. These contracts were awarded to him. They came to him. He didn’t solicit anything from MDHS. He undertook these contracts and attempted to perform the work.”
“So what this boils down to is do people feel like this was an appropriate use of TANF money or other money to carry out the function of government?” Gilbert continued. “That’s a fair question, and that’s a question that reasonable people absolutely can disagree about. But it’s not a crime. You resolve your dissatisfaction with the way the government functions at the polling place.”
This article first appeared on Mississippi Today and is republished here under a Creative Commons license.
Mississippi Stories Videos
Mississippi Stories: Michael May of Lazy Acres
In this episode of Mississippi Stories, Mississippi Today Editor-at-Large Marshall Ramsey takes a trip to Lazy Acres. In 1980, Lazy Acres Christmas tree farm was founded in Chunky, Mississippi by Raburn and Shirley May. Twenty-one years later, Michael and Cathy May purchased Lazy Acres. Today, the farm has grown into a multi seasonal business offering a Bunny Patch at Easter, Pumpkin Patch in the fall, Christmas trees and an spectacular Christmas light show. It’s also a masterclass in family business entrepreneurship and agricultural tourism.
For more videos, subscribe to Mississippi Today’s YouTube channel.
This article first appeared on Mississippi Today and is republished here under a Creative Commons license.
Mississippi Today
On this day in 1921
Jan. 21, 1921
George Washington Carver became one of the first Black experts to testify before Congress.
His unlikely road to Washington began after his birth in Missouri, just before the Civil War ended. When he was a week old, he and his mother and his sister were kidnapped by night raiders. The slaveholder hired a man to track them down, but the only one the man could locate was George, and the slaveholder exchanged a race horse for George’s safe return. George and his brother were raised by the slaveholder and his wife.
The couple taught them to read and write. George wound up attending a school for Black children 10 miles away and later tried to attend Highland University in Kansas, only to get turned away because of the color of his skin. Then he attended Simpson College in Indianola, Iowa, before becoming the first Black student at what is now Iowa State University, where he received a Master’s of Science degree and became the first Black faculty member.
Booker T. Washington then invited Carver to head the Tuskegee Institute’s Agriculture Department, where he found new uses for peanuts, sweet potatoes, soybeans and other crops.
In the past, segregation would have barred Carver’s testimony before Congress, but white peanut farmers, desperate to convince lawmakers about the need for a tariff on peanuts because of cheap Chinese imports, believed Carver could captivate them — and captivate he did, detailing how the nut could be transformed into candy, milk, livestock feed, even ink.
“I have just begun with the peanut,” he told lawmakers.
Impressed, they passed the Fordney-McCumber Tariff of 1922.
In addition to this work, Carver promoted racial harmony. From 1923 to 1933, he traveled to white Southern colleges for the Commission on Interracial Cooperation. Time magazine referred to him as a “Black Leonardo,” and he died in 1943.
That same year, the George Washington Carver Monument complex, the first national park honoring a Black American, was founded in Joplin, Missouri.
This article first appeared on Mississippi Today and is republished here under a Creative Commons license.
Mississippi Today
Legislative recap: 2025 tax cut battle has been joined
After relatively brief debate and questioning given its magnitude, the state House passed the first meaningful legislation of the new session: House Bill 1, a measure that would eliminate the state income tax, trim taxes on non-prepared food and raise sales and gasoline taxes.
It would mark a sea change in state tax structure, a shift from income to consumption taxation.
“We are at a place where we can finally tell the hard-working people of Mississippi we can eliminate the tax on work,” House Ways and Means Chairman Trey Lamar, HB1’s author, told his colleagues.
The measure passed the House 88-24. It gained some Democratic support in the supermajority Republican House, with nine Democrats voting in favor, 24 against and 12 voting present.
The proposal garnered some bipartisan support because it includes at least a couple of items Democratic lawmakers have championed in the past: A gasoline tax to help fix crumbling roadways, and a reduction in the “grocery” tax, or the sales tax levied on unprepared food, of which Mississippi has the highest overall rate in the nation.
It still met with some Democratic opposition in part because it is a sea change toward more “regressive” taxation. Proponents say this is just, people should pay more for state services they use, such as roadways, and for things they buy as opposed to taxing income. Opponents say this places a proportionately higher tax burden on people of modest means.
“I would say the people hurt the most with this would be working people who have to put gas in their car to go to work or those who have to purchase materials to do a job,” House Democratic Leader Robert Johnson said.
Beyond that concern, opponents or skeptics worry that the foundation of the proposed tax overhaul would be built on shifting sands — a state economy that has been so rosy primarily from the federal government dumping billions of dollars in pandemic spending into Mississippi. With the federal spigot being cut off, some worry, the state economy could slump, and the massive tax cuts in this new plan could provide a state budget crisis, of which Mississippi has much experience, and underfunding of crucial services such as schools, roads, health care and law enforcement.
The largest hurdle Republican House leaders face in seeing their tax plan through to law is not in garnering bipartisan support. It’s internecine disagreement with the Senate Republican leadership, which still appears to harbor abovementioned concerns about overhauling tax structure in uncertain economic times and betting on growth to cover massive tax cuts.
Senate leaders have said they want to enact more tax cuts, but their plan has not yet been released. Lt. Gov. Delbert Hosemann has provided some details of what he wants to see, but it would appear he wants a more cautious approach on cuts. He has not publicly opined on the tax increases in the House plan.
Quote of the Week
“Have you ever worn a belt and suspenders, lady? It’s a belt and suspenders approach.” — Rep. Trey Lamar, R-Senatobia, to Rep. Omeria Scott, D-Laurel, during floor debate on Lamar’s bill to eliminate the state income tax and raise other taxes.
“No. I have not worn a belt and suspenders. I don’t know anyone who has worn a belt and suspenders,” Scott replied.
In Brief
House will renew push to legalize mobile sports betting
House Gaming Committee Chairman Casey Eure, R-Saucier, told Mississippi Today he plans on taking another crack at legalizing mobile sports betting in the state. In 2024, the House and Senate passed versions of legislation to permit online sports betting, but never agreed on a final proposal. Some lawmakers raised concerns that gambling platforms would have no incentive to partner with smaller casinos, and most of the money would instead flow to the Mississippi Gulf Coast’s already bustling casinos. Proponents say legalization would undercut the influence of illicit offshore sports betting platforms.
“I’ve been working on this bill for many years and I’m just trying to satisfy any concerns that the Senate may have so we can pass this and start collecting the tax dollars that the state deserves and not allowing everyone to place bets with these offshore accounts,” Eure said. “I feel like the state is losing between $40-$80 million a year in tax revenue.”
Sports wagering has been permitted in the state for years, but online betting has remained illegal amid fears the move could harm the bottom line of the state’s brick-and-mortar casinos. Mobile sports betting is legal in 30 states and Washington, D.C., according to the American Gaming Association. — Michael Goldberg
Hosemann makes Senate committee chair changes
Republican Lt. Gov. Delbert Hosemann last week named new chairmen of committees, after former state Sen. Jenifer Branning was sworn into office as a new justice on the Mississippi Supreme Court.
Sen. Chuck Younger, a Republican from Columbus, previously led the Senate Agriculture Committee and will replace Branning as chairman of the Transportation Committee. Sen. Neil Whaley, a Republican from Potts Camp, previously led the Senate Wildlife, Fisheries and Parks Committee, but will now lead the Senate Agriculture Committee.
Here are the other changes to Senate committees:
Sen. Ben Suber, a Republican from Bruce, will be the new chairman of the Senate Wildlife, Fisheries and Parks Committee
Sen. Bart Williams, a Republican from Starkville, is the new chairman of the Senate Public Property Committee
Sen. Scott DeLano, a Republican from Gulfport, will lead the Senate Technology Committee
Sen. Robin Robinson, a Republican from Laurel, will chair the Senate Labor Committee
Sen. Angela Turner Ford, a Democrat from West Point, will lead the Senate Drug Policy Committee. — Taylor Vance
What’s in a name? Democratic Rep. Scott hopes GOP majority will pass ‘Donald J. Trump Act’ bills
Perhaps tired of seeing many measures she authors ignored or shot down in flames by the Republican supermajority in the Mississippi Legislature, Democratic Rep. Omeria Scott of Laurel is trying a new strategy: naming bills after Republican President-elect Trump.
For this session, Scott has authored: House Bill 61, the “Donald J. Trump Voting Rights Restoration Act;” House Bill 62, the “Donald J. Trump Ban-The-Box Act … to prohibit public employers from using criminal history as a bar to employment;” and House Bill 249, the “Donald J. Trump Early Voting Act.” — Geoff Pender
More bills filed to criminalize abortion
Since the 2022 Dobbs Supreme Court decision overturned the constitutional right to an abortion, Mississippi lawmakers have proposed bills to criminalize workarounds to the state’s strict abortion ban – including criminalizing the abortion pill and out-of-state abortions. The 2025 legislative session is no exception.
Rep. William Tracy Arnold, R-Booneville, filed House Bill 616 that would make it a felony to manufacture or make accessible medication abortion. Anyone convicted of the crime would be subject to a fine between $1,000 and $5,000, as well as imprisonment between two and five years. Last year, about 250 Mississippians each month requested medication abortion from Aid Access, the only online telemedicine service supplying medication abortion via mail in the U.S.
Helping a minor receive an abortion would also be criminalized under House Bill 148 filed by Rep. Mark Tullos, R-Raleigh. That would include transporting a minor out of state to undergo an abortion, as well as helping a minor procure a medication abortion – both of which would be punishable by not less than 20 years in prison or a fine of not less than $50,000. — Sophia Paffenroth
By the Numbers
$1.1 billion
The estimated net annual cost of the House plan to eliminate the state income tax and raise sales taxes, once fully phased in. Proponents say economic growth would allow the state budget, currently about $7 billion a year, to absorb the cut. Eliminating the income tax would cost the state $2.2 billion in revenue, but the House plan would raise about $1.1 billion in other taxes in offset.
0
The amount of income tax Mississippians would pay after a 10-year phased in elimination of the state income tax. With previous cuts being phased in, state income taxes next year will already be reduced to 4%, among the lowest rates in the nation.
8.5 %
The new Mississippi sales tax, up from current 7%, under the House tax plan assuming most local governments would not opt out of adding a new 1.5% local sales tax.
13 cents more a gallon
The cost of the House’s proposed new 5% gasoline tax, based on last week’s average cost of gasoline in Mississippi of $2.62. The new 5% tax would be on top of the flat 18.4 cents a gallon current state excise on gasoline.
4%
The tax on unprepared food once a reduction of the current 7% would be phased in over a decade under the House plan. The state would over time reduce its sales tax on such groceries to 2.5%, but local governments would add a 1.5% sales tax to such items unless they opt out.
Full Legislative Coverage
Lawmakers must pass new legislation to improve access to prenatal care
Lawmakers will file another bill this session to help low-income pregnant women get into the doctor earlier – after the federal government rejected the program set up under last year’s law, because of discrepancies between what was written into state law and federal regulations for presumptive Medicaid eligibility. Read the story.
Proposal: eliminate income tax, add 5% tax on gas, allow cities, counties to levy local sales tax
House leaders last week unveiled a sweeping tax cut proposal that would eventually abolish the state income tax, slash taxes on groceries, increase local sales taxes and shore up funds for state and local road work. Read the story.
A new Mississippi law aims to limit jailing people awaiting mental health treatment. Is it working?
Officials say a new law to decrease the number of people being jailed solely because they need mental health treatment has led to fewer people with serious mental illness detained in jails – but the data is contradictory and incomplete. Lawmakers plan legislation to make more counties report the data. Read the story.
How soon we forget: Mississippi House push for record tax cuts revives fear of repeat budget crises
Eight years ago, from a combination of dozens of tax cuts the Legislature approved and a slumping economy, the state saw a budget crisis that resulted in severely underfunded schools, government layoffs, a near halt to building new roads and highways and problems maintaining the ones we have, too few state troopers on the highways and cuts to most major state services. Read the story.
NAACP legislative redistricting proposal pits two pairs of senators against each other
The Mississippi chapter of the ACLU has submitted a proposal to the courts to redraw the state’s legislative districts that creates two new majority-Black Senate districts and pits two pairs of incumbent senators against one another. Read the story.
Legislation to send more public money to private schools appears stalled as lawmakers consider other changes
Some top lawmakers in Mississippi’s Republican-controlled Legislature are prepared to make it easier for students to transfer between public schools but remain skeptical of sending more public money to private schools. Read the story.
House passes $1.1 billion income tax elimination-gas and sales tax increase plan in bipartisan vote
A bill that phases out the state income tax, cuts the state grocery tax and raises sales taxes and gasoline taxes passed the House of Representatives with a bipartisan vote on Thursday. Read the story.
Tate Reeves and other top Mississippi Republicans owe thanks to President Joe Biden
The tremendous cash surpluses that some state Republicans cite when defending their plan to eliminate the state’s income tax would not exist if not for the billions of dollars in federal funds that have been pumped into the state during Biden’s presidential tenure. Read the story.
Podcast: Mississippi transportation director discusses proposed new gasoline tax
Mississippi Department of Transportation Director Brad White tells Mississippi Today’s Geoff Pender and Taylor Vance he’s staying “in his lane” and out of the politics of a House tax overhaul that would eliminate the income tax and raise sales and gasoline taxes, but that he’s pleased lawmakers are trying to address the long running need for a steady new stream of money to help cover highway maintenance needs. Listen to the podcast.
This article first appeared on Mississippi Today and is republished here under a Creative Commons license.
-
News from the South - Florida News Feed6 days ago
Speaker Johnson removes chair of powerful House Intelligence Committee
-
News from the South - Georgia News Feed5 days ago
Georgia senator arrested for trying to defy ban on entering House chamber
-
News from the South - Georgia News Feed5 days ago
U-Haul: South Carolina the fastest growing state in the country
-
News from the South - Louisiana News Feed4 days ago
Tracking weekend rain and chances for wintry weather
-
News from the South - Tennessee News Feed3 days ago
‘Don’t lose hope’: More than 100 Tennesseans protest incoming Trump administration
-
News from the South - Louisiana News Feed4 days ago
Tracking wintry weather potential
-
News from the South - Louisiana News Feed4 days ago
Southeast Louisiana officials brace for freezing temperatures
-
News from the South - Tennessee News Feed4 days ago
Speed limit reduced on State Route 109 in Wilson County