A key figure in Mississippi’s welfare spending scandal has pleaded guilty to federal fraud charges under an arrangement that signals he may be cooperating, according to court records.
John Davis directed Mississippi’s welfare agency while it doled out millions of dollars in federal welfare money to projects investigators now say were improper, including a new volleyball facility requested by former NFL quarterback Brett Favre that benefited his daughter.
According to court records, Davis agreed to plead guilty to conspiracy to commit fraud and theft — charges that together carry a maximum of 15 years in prison.
“At Davis’s direction, (Mississippi’s welfare agency) provided federal funds to two nonprofit organizations and then directed the two nonprofit organizations to fraudulently award contracts to various entities and individuals for social services that were never provided,” the Justice Department said in a news release.
The plea represents the first federal prosecutorial action in the two-year-old scandal, though another main player has been indicted on unrelated federal charges.
Davis worked for then-Gov. Phil Bryant, who has consistently denied that he was aware that federal welfare money was being used for the projects, in violation of state and federal laws.
As NBC News has previously reported, Davis was involved in discussions with Bryant and Favre about securing millions of dollars for the volleyball facility. Favre also secured $3.2 million for a drug company in which he had invested, according to court records.
Nancy New, a former nonprofit executive who also is cooperating after a guilty plea, distributed the money in consultation with Davis and the governor, court records show.
In complex investigations, prosecutors often try to secure cooperation from some defendants who they hope will testify against people who directed them. The only figure higher than Davis, the welfare director, is Bryant. He has denied wrongdoing.
Favre has also denied wrongdoing through his lawyer, who acknowledged that Favre has been interviewed by the FBI. There is no indication Favre is a target of the investigation, and he says he did not know the state grants came from federal welfare funds.
The scandal has drawn outrage, in part because Mississippi is the poorest state in the nation and one of the stingiest when it comes to the number of families who are deemed eligible for federal welfare help.
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