HINDS COUNTY, Miss. (WJTV) – On Tuesday, April 26, a change of plea hearing was held at the Hinds County Courthouse for Nancy and Zachary New in connection to Mississippi’s sprawling welfare scandal.
The two pled guilty to state charges of bribery of a public official, wire fraud and fraud against the government.
The News were arrested in 2020 for their roles in connection to the $77 million of misspent welfare funds. Prosecutors said the change in plea is a resounding victory.
They both acknowledged spending welfare grant money on lavish gifts that included first-class airfare for John Davis, executive director of the state Department of Human Services from 2016 to 2019.
The News agreed to testify against others in what the state auditor has called Mississippi’s largest public corruption case in the past two decades. Davis is among those facing state charges.
“Today is a good victory for the State of Mississippi and citizens when you see a ruling that says that we will not tolerate the powerful preying on the weak. I want to thank the U.S. Attorney’s Office and the State Auditor’s Office for years of work to get to this conclusion. As you know, we’re governed by a gag order for the additional case, so we can’t say much, but we think this is a loud and resounding message,” said Hinds County District Attorney Jody Owens.
The mother and son ran the nonprofit Mississippi Community Education Center, which received millions of dollars from Temporary Assistance to Needy Families and was supposed to spend it to help poor people. Nancy New was president and Zachary New was vice president of operations for New Learning Resources Inc., which ran three private schools that offered services for children with autism or dyslexia.
The News will be sentenced at a later date. The state recommended that Nancy New be sentenced to 99 years in prison with 25 to be served. They also recommended that Zach New be sentenced to 75 years in prison with 17 to serve.
State Auditor Shad White released the following statement about the case.
Today Nancy and Zach New pleaded guilty to the largest public fraud scheme in state history. I will avoid extensive commentary because there is still a gag order in one case, but as I said today, I’m proud of the work my investigators and the prosecutors did to get us here.
I’ve pledged to both state and federal prosecutors that we will help them obtain any information they need as they decide on others they will charge.
In February 2020, I gave the FBI access to all the evidence we had. Since then we’ve worked hand in glove each day with them to move this case forward. Between us, the FBI, and the Office of the Inspector General, this case will be fully investigated. Period.
State Auditor Shad White
The Associated Press contributed to this report.