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<h1>‘A whitewash’: Emails present MDHS pushed to hamstring probe into welfare misspending</h1><br /> <p class=”byline”>by Geoff Pender and Anna Wolfe, Mississippi Right this moment <br />August 10, 2022</p> <p><p>The Mississippi Division of Human Providers employed an accounting agency, utilizing welfare {dollars}, to ostensibly unravel who stole or misspent tens of millions in federal grant funds and attempt to recoup them.</p><br /> <p>However never-before-published emails Mississippi Right this moment obtained via a information request present Gov. Tate Reeves’ appointed MDHS director pushed to restrict who and what the employed forensic audit might study. And he tried to maintain the state auditor and different legislation enforcement businesses out of the combo.</p><br /> <p>”That is nothing however a whitewash to indicate that MDHS was not complicit on this downside, apart from (former MDHS Director) John Davis,” a deputy in state Auditor Shad White’s workplace wrote to White in April of 2020 after reviewing the proposal MDHS drafted to solicit an auditing agency.</p><br /> <p>White’s workplace was to be a “third occasion” to a contract with a forensic auditor. However MDHS pushed to restrict the Workplace of the State Auditor’s involvement and even at one level omitted language requiring the impartial auditor to contact OSA or different legislation enforcement if it noticed potential crimes — a normal apply in audit contracts.</p><br /> <p>Gov. Reeves mentioned he appointed MDHS Director Bob Anderson, a former prosecutor, in March of 2020 to scrub up the welfare company. Weeks into Anderson’s administration, he clashed with White over the forensic audit proposal, information present. White pushed to develop the breadth of the evaluate and supply extra OSA involvement.</p><br /> <p>”We ought to be on the identical facet – the facet of the taxpayers, looking for the misspending that occurred at DHS and all of the folks accountable,” White wrote to Anderson in April of 2020 throughout heated negotiations concerning the forensic audit proposal. “For my part, you might be both for an audit that can reveal these issues, just like the audit we’ve proposed, or you aren’t. Your proposal because it stands would waste taxpayer cash and never attain the problems that must be reached.”</p><br /> <p>Neither Reeves nor Anderson would conform to an interview concerning the forensic audit points or present remark in response to Mississippi Right this moment’s findings.</p><br /> <p><sturdy>READ MORE</sturdy>:&nbsp;<a href=”https://mississippitoday.org/2022/07/23/welfare-head-says-surprise-subpoena-led-to-attorneys-firing-emails-show-it-wasnt-a-surprise/” goal=”_blank” rel=”noreferrer noopener”>Welfare head says shock subpoena led to legal professional’s firing. Emails present it wasn’t a shock</a></p><br /> <p>White, who’s concerned in separate state and federal prison investigations into the welfare scandal, appeared to win some concessions on the ultimate forensic audit contract. On the similar time, he objected to MDHS accessing the auditor’s workplace’s workpapers.</p><br /> <p>However in the long run, the distinguished nationwide accounting agency Clifton Larson Allen employed for the audit famous it was restricted&nbsp;— and in some circumstances <a href=”https://www.documentcloud.org/paperwork/22039712-2022-mdhs-tanf-forensic-audit-expanded-email-review#doc/p11/a2138964″ goal=”_blank” rel=”noreferrer noopener”>”severely restricted”</a> — in what and whom it might study in its probe and mentioned it might doubtless have discovered extra misspending if allowed freer rein.</p><br /> <p>MDHS just lately lamented the forensic audit’s limitations, and <a href=”https://mississippitoday.org/2022/06/29/mississippi-welfare-fraud-scandal-questions/” goal=”_blank” rel=”noreferrer noopener”>tried to put these limitations off on Auditor White’s workplace</a>. However communications between the 2 throughout spring of 2020 point out MDHS pushed for extreme limits on the probe.</p><br /> <p>”If I have been you, I might need to know the place the misspending occurred and who’s accountable, not spend my time negotiating downward an audit with OSA,” White wrote to Anderson. “If you wish to spend DHS cash on this audit in order that the present workers can keep away from wanting unhealthy, with out you discovering who was concerned with the misspending, then you’ll bear the duty for that and any further misspending that occurs going ahead. I cannot take part.”</p><br /> <p>Gov. Reeves, who oversees MDHS and appointed Anderson, just lately mentioned the CLA forensic audit is the lodestar for the state’s lawsuit towards quite a few folks and companies to attempt to recuperate a number of the a minimum of $77 million in misspent welfare cash. He additionally made clear he’s calling the most important photographs at MDHS in relation to the lawsuit.</p><br /> <p>Reeves fired the legal professional MDHS had employed to recuperate the cash after the legal professional went past the scope of the forensic audit. The legal professional tried to subpoena information about attainable involvement of former Gov. Phil Bryant and his spouse, former NFL soccer star Brett Favre and the USM Athletic Basis — lots of whose board members are massive marketing campaign donors and political supporters of Reeves. Reeves mentioned legal professional Brad Pigott ought to have caught to the metes and bounds of the forensic audit, and accused him of getting a political agenda and looking for the media highlight when he went past it.</p><br /> <p><sturdy>READ MORE</sturdy>:&nbsp;<a href=”https://mississippitoday.org/2022/07/28/tate-reeves-welfare-scandal-attorney-brad-pigott/” goal=”_blank” rel=”noreferrer noopener”>Gov. Tate Reeves says ousted welfare scandal lawyer had ‘political agenda,’ wished media highlight</a></p><br /> <p>White has criticized Pigott’s firing and mentioned the state ought to search to recuperate all of the misspent cash it may well. He mentioned he’ll ensure that state and federal prison investigators have the information Pigott tried to subpoena.</p><br /> <p>On the time MDHS was getting ready the forensic audit proposal request, White was already gearing as much as launch a report in Could of 2020 that questioned $94 million in MDHS spending and illustrated systemic failures of the welfare division.</p><br /> <p>White’s audit discovered that the welfare division regularly violated the legislation by spending funds from a federal program known as Short-term Help for Needy Households, a federal block grant infamous for getting used as a slush fund in some states on initiatives that didn’t fulfill the needs of the grant or didn’t serve the needy.</p><br /> <p>However the forensic audit by an impartial agency, not White’s report, can be the doc the state would use to find out who to carry civil litigation towards to recoup misspent funds.</p><br /> <p>Some folks, together with <a href=”https://mississippitoday.org/2020/11/14/key-figure-in-welfare-scandal-said-she-was-told-to-make-payments-to-florida-drug-company/” goal=”_blank” rel=”noreferrer noopener”>a minimum of one prison defendant arrested in February of 2020</a>, anticipated a forensic audit to considerably contradict White’s narrative about widespread misuse. An electronic mail White despatched his deputies alludes to the notion some had that the auditor’s workplace had an agenda in going after MDHS.</p><br /> <p>”I’m additionally tempted to inform them it is a nice method to decide if we’re auditing to ‘body’ a ‘narrative’ or not: simply let a non-public CPA have broad leeway to verify or disprove our findings,” White wrote.</p><br /> <p>Emails Mississippi Right this moment obtained now reveal that MDHS’s present management might have tried to put its thumb on the size to mitigate publicity for the company as a complete, together with dozens of workers who reviewed expenditures and contracts.</p><br /> <p>”To be utterly sincere — it is a half-hearted try to finish a forensic audit that has utterly erased our enter,” wrote Stephanie Palmertree, monetary and compliance audit director for the state auditor’s workplace who headed up a lot of its MDHS probe. “And seeing how MDHS is defending the clearly fabricated contract procurements that they’ve accomplished, I am undecided I might belief the present workers to decide on an impartial auditor. It is a PR try at making MDHS appear to be they did all they might.”</p><br /> <p><sturdy>READ MORE:</sturdy> <a href=”https://mississippitoday.org/2022/08/02/7-baffling-things-mississippi-welfare-case/” goal=”_blank” rel=”noreferrer noopener”>7 baffling issues about Mississippi’s welfare fraud scandal case</a></p><br /> <p>As a part of the invention course of within the civil case, Mississippi Group Training Heart, the nonprofit based by prison defendants Nancy New and her son Zach New, has requested for communication from MDHS associated to the forensic audit to look at the way it might have artificially focused choose distributors.&nbsp;</p><br /> <p>In his electronic mail response to a missive from White in April 2020, Anderson mentioned, “My goal is and has been since I arrived right here at MDHS to ferret out the misspending and the accountable events … We’re making an attempt to vogue an RFI (Request for Data) that captures the settlement between each the businesses and that defines the parameters of what is going to be an costly and prolonged audit endeavor.”</p><br /> <p>The contract with CLA was for as much as $2.1 million. However in response to a evaluate of expenditures on the state’s transparency web site, MDHS has solely paid the agency lower than $800,000, one in all few occasions the company has appeared frugal with spending federal welfare {dollars} on issues apart from poor folks.</p><br /> <p>At one level, in response to White’s workplace suggesting adjustments to the audit proposal, Anderson mentioned, “A lot of what we took out pertains to the prison investigation … which isn’t the aim for this forensic audit for the reason that prison case is already indicted …”</p><br /> <p>White took umbrage with this and responded: “You might be conscious that the assertion ‘the prison case is already indicted’ is inaccurate; I’ve instructed you and the general public that the case continues to be being investigated. Extra indictments are attainable. Even when the investigation weren’t nonetheless ongoing, one would need prison exercise reported to legislation enforcement.</p><br /> <p>”… I am undecided why you eliminated each your earlier language and OSA’s language on reporting prison exercise,” White wrote to Anderson. “… Additionally, there’s some confusion about what a ‘forensic’ audit is. The AICPA (American Institute of Licensed Public Accountants) notes that the time period forensic means to be appropriate to be used in a court docket of legislation. Eradicating the language that claims this audit might function proof in a authorized continuing is to take away a part of the audit’s very objective.</p><br /> <p>”The identical could possibly be mentioned for eradicating the language about how auditors could also be known as to testify in court docket,” White wrote. “And the identical could possibly be mentioned for eradicating language requiring misappropriations to be ‘listed by particular person, as could possibly be confirmed in a authorized continuing.’ This audit ought to hint expenditures to completion and present, with findings that might arise as proof in court docket, who directed that spending, whether or not these individuals are inside or outdoors DHS.”</p><br /> <p>Requested for remark about limitations on CLA’s forensic audit, a spokesman for White’s workplace mentioned, “We are going to let CLA’s audit communicate for itself on areas the place CLA believed that they had sufficient data to conduct the audit and the place CLA was restricted.”</p><br /> <p>In its audit reviews delivered in September of 2021, CLA famous that it was not given entry to former DHS Director John Davis’ laptop onerous drive and it was initially restricted in whose emails it might study.</p><br /> <p>“CLA was unable to acquire a duplicate of John Davis’ MDHS onerous drive, because it was within the possession of the (Workplace of State Auditor) investigative division. Moreover, the scope of labor restricted CLA’s evaluate of emails to incorporate solely John Davis’ MDHS emails. If different digital proof had been made obtainable to CLA, further data not presently recognized to CLA might affect the findings communicated on this report.”</p><br /> <p><sturdy>READ MORE:&nbsp;</sturdy><a href=”https://mississippitoday.org/2022/06/29/mississippi-welfare-fraud-scandal-questions/” goal=”_blank” rel=”noreferrer noopener”>‘It doesn’t look good’: At 3-year mark, extra questions than solutions in Mississippi welfare fraud scandal</a></p><br /> <p>White’s spokesman mentioned: “As we’ve defined beforehand, the onerous drive (it was truly his laptop) was obtained via our prison investigation. We don’t make proof obtained in a prison investigation obtainable to anybody outdoors of legislation enforcement. That features personal CPA companies. In fact, we obtained that laptop from DHS. If DHS backed up any information on the pc to their community, that could possibly be made obtainable per a public information request. We’d additionally remind you that, whereas we is not going to present the pc to a non-public CPA agency, we’ve made all of our proof, together with the onerous drive, obtainable to the FBI.”</p><br /> <p>CLA additionally famous that the New nonprofit, Mississippi Group Training Heart, didn’t present information to the auditors and didn’t cooperate with its probe. A lot of the theft and misspending within the scandal occurred via MCEC, which was serving to run a statewide anti-poverty program known as Households First for Mississippi.</p><br /> <p>White’s spokesman mentioned: “Regardless of pledging to help auditors, the Information failed to offer MCEC’s unique documentation of spending to CLA, as CLA famous. CLA was given entry to copies of all of the MCEC paperwork (contracts, invoices, basic ledger reviews, and so forth.) that the auditor’s workplace had. Sadly, copies are usually not thought-about unique documentation. Solely MCEC might present unique documentation. With out unique documentation, CLA needed to notice that their audit was restricted. DHS finally determined to not pursue acquiring unique paperwork from MCEC after MCEC didn’t cooperate. OSA was requested to make use of our subpoena energy to acquire paperwork from Coronary heart of David, and we did.”</p><br /> <p>However in a supplemental forensic audit report launched in April, Clifton Larson Allen famous that they did not even have entry to a lease settlement that the State Auditor possessed, and <a href=”https://www.documentcloud.org/paperwork/22039712-2022-mdhs-tanf-forensic-audit-expanded-email-review#doc/p15/a2138533″ goal=”_blank” rel=”noreferrer noopener”>have been pressured to retrieve it from a information article</a>.</p><br /> <p>One other deputy in White’s workplace who reviewed MDHS’ drafts for a forensic audit proposal, on the time famous, “Very restricted scope outdoors of TANF (federal welfare {dollars}). We all know SSBG, CCDF and SNAP funds have been additionally misused. They’ve even restricted the scope to contracts directed by Davis to solely TANF contracts … Agency is simply required to alert MDHS of potential prison exercise, not us, the federal authorities or legislation enforcement.”</p><br /> <p>White, on the time, wrote to Anderson: “Clearly prison exercise ought to be reported to us, not simply DHS, as we’re the state’s chief legislation enforcement company for crimes involving public funds. DHS’s failure to report prison exercise to the Auditor’s workplace has been an issue prior to now.”</p><br /> <p>White’s spokesman this week defined that OSA auditors, as routine, repeatedly requested DHS workers over a number of years in the event that they knew of fraud on the company, and “… Staffers repeatedly didn’t report any fraud in these conferences.”</p><br /> <p>Whereas it was admittedly incomplete, the forensic audit report <a href=”https://mississippitoday.org/2021/10/04/new-audit-mississippi-welfare-misspending/” goal=”_blank” rel=”noreferrer noopener”>launched in October 2021 </a>didn’t considerably reverse White’s findings. It decided a complete of $77 million was misspent: <a href=”https://mississippitoday.org/wp-content/uploads/2021/10/20sHuman-Providers-Division-of-cpa-1.pdf” goal=”_blank” rel=”noreferrer noopener”>$36.1 million in welfare purchases that broke</a> federal guidelines, together with <a href=”https://mississippitoday.org/wp-content/uploads/2021/10/20sHuman-Providers-Division-of-cpa.pdf” goal=”_blank” rel=”noreferrer noopener”>$12.4 million value of attainable fraud, waste or abuse</a>, plus a further $40 million that auditors mentioned they didn’t have correct documentation to investigate.</p><br /> <p><sturdy>THE BACKCHANNEL:</sturdy>&nbsp;<a href=”https://mississippitoday.org/the-backchannel/” goal=”_blank” rel=”noreferrer noopener”>Full protection of Mississippi’s welfare scandal</a></p> <p>This <a goal=”_blank” href=”https://mississippitoday.org/2022/08/10/mississippi-welfare-scandal-probe-limit/”>article</a> first appeared on <a goal=”_blank” href=”https://mississippitoday.org”>Mississippi Right this moment</a> and is republished right here below a Artistic Commons license.<img src=”https://i0.wp.com/mississippitoday.org/wp-content/uploads/2021/01/MT_square-thumb.jpg?match=150percent2C150&amp;ssl=1″ type=”width:1em;top:1em;margin-left:10px;”><img id=”republication-tracker-tool-source” src=”https://mississippitoday.org/?republication-pixel=true&publish=1078914&ga=UA-75003810-1″ type=”width:1px;top:1px;”> <p>