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State Auditor Shad White discusses welfare investigation, former Gov. Phil Bryant

Since Auditor Shad White arrested Gov. Phil Bryant’s appointed welfare director in 2020 within a sprawling fraud scheme, state and federal investigators and prosecutors have failed to publicly scrutinize the governor’s role — which is palpable in written communication they’ve possessed for more than two years. 

Much of that communication has been published for the first time in Mississippi Today’s “The Backchannel” investigation, which uncovers the depth of the former governor’s involvement within the scandal that plagued his administration.

White, a former Bryant staffer and campaign manager who the former governor later appointed as state auditor, sat down with Mississippi Today on Oct. 14, 2021, for an in-depth interview about the welfare department and his investigation of it.

Highlights of the interview include:

  • White said that he believed it was the welfare director’s duty to reject any improper requests from the governor, not the governor’s responsibility to know agency spending regulations.
  • White said that he had not seen any evidence of Bryant directing his welfare agency head to make specific payments to specific programs.
  • White said that if there was evidence of Bryant directing payments, the welfare director awaiting trial should point that out to investigators or prosecutors.

Soon after the interview, Mississippi Today obtained thousands of written communications between the governor and principal players in the scandal that shed light on Bryant’s involvement. When we conducted the interview with White, we didn’t yet know much of what we’ve published in “The Backchannel” investigation.

Since the interview, the judge in an ongoing criminal case has reinforced the gag order against White, meaning this is likely his final on-the-record interview about the scheme until the criminal cases are over. Those cases could continue for the rest of the year or longer. For that reason, we are publishing the interview, which has been edited for length and clarity.

Two additional notes to consider while reading: Because the investigation was then and is still ongoing, White often spoke in hypotheticals while answering questions. Second, the interview was conducted just days after White issued civil demand letters for 15 people or organizations to return a total of $77 million in misspent welfare dollars.

MT: Especially after seeing the demand letters, and particularly the one to John Davis, it’s just making me think more and more about how he is really being held accountable for this whole overarching scheme, a lot of which didn’t benefit him personally. Right? And lots of other people benefited much more than he did. I guess I just want to ask you generally, with the tack that you’re taking to try to be accountable for taxpayer money, how you think that’s going to change this good ole boy structure that the John Davis case illustrates, which is pervasive through Mississippi’s government.

WHITE: You know, I think the first and most important thing is that the demand that John Davis — which is obviously large. It’s $96 million when you add interest. That’s the largest demand that’s ever been issued by this office, period. The demand that is issued to John Davis sends this message that if you are legally responsible for making sure that money is spent in accordance with the law and you don’t follow the law and you do whatever you want to with it, and you spend it in ways that are maybe politically beneficial to you, then you’re going to be held accountable.

And I don’t know of another way to better send that message than to just enforce the law as it is written and hold someone to the standard that the law sets, which is, if you’re running an agency, handling all this money and you’re responsible for making sure that it goes to the actual program beneficiaries that the program was designed to serve, that you actually do that.

That’s, I think, the first thing. And then there’s the second layer under that, which is, if there is a criminal case to be made, that you have to be willing — and I say you, meaning investigators and prosecutors and the court system — has to be willing to enforce the criminal law, too. Now, you and I know that not every case is a DHS-level case. We see instances of misappropriation that don’t get anywhere near $77 million. We see instances of misappropriation that don’t come with a criminal charge because what was done did not violate a criminal statute. But in this case, you’ve got large dollar amounts and you’ve got civil and criminal cases that are possible.

And so when something like this happens, you have to do your job. You meaning me — I have to do my job. And prosecutors have to do their jobs and the court has to do its job.

And I think that that’s how you begin to unwind a system where people believe that rules are not real. Because that’s what I’m afraid existed for a long time in some corners of Mississippi, that people just believed that the rules were not real, but the rules are the law.

That’s where we’re getting these rules from. The rules come from regulations and statutes passed by democratically elected officials. And those are important. It’s important to me personally. It’s a value that I hold very deeply and I’ve spent a lot of my life thinking about it.

And so, we just have to have more people who are, one, in positions of influence, who are willing to follow the law, and more people who are willing to step up and enforce it if those individuals in positions of influence don’t follow the law.

MT: Right. But I guess when I think about John Davis, I think about how he was doing what everyone around him does and has been doing. And how is taking John Davis as an individual down, going to change the culture and the overarching structure of people doing favors for people. And I guess, let me take it a little further, because I’ve now consumed enough information and have details of the way that Phil Bryant and John Davis interacted. And Phil Bryant directed John Davis’ actions.

And how do we hold the state’s top official accountable in the same way that we’re holding John Davis accountable.

White: When you say, Phil Bryant directed John Davis’ actions, are you saying that there is specific evidence that Phil Bryant told John Davis to spend money in certain ways?

MT: Yeah.

White: OK.

MT: I mean, that’s clear.

White: We would love to see any evidence to that effect that anybody has. I would first say that. I mean, we have gathered tons of evidence in this case. But if there’s any documented evidence or anything like that, that exists, we need to make sure that we have it. That’s the first big thing I would say.

MT: I don’t think you’re going to find a piece of paper that shows Phil Bryant telling John Davis, for example, to give money to Prevacus. But there were meetings that took place, and there were examples of him directing him to do other things with money. And those specific things might not be part of the criminal allegations, but it shows the pattern of how they communicated.

White: Yeah. So, we know the meetings took place, right? That’s been publicly reported and there’s nothing illegal, obviously, about a meeting. Right? You would expect that right now, if someone came to Tate Reeves and said, “Hey, I have a potential drug that could be manufactured in Mississippi, and I would like to sit and talk with you about that potential.” If Tate Reeves’ team thought that was a real proposal, then the governor probably should take a meeting like that, I would think. So that’s kind of the first thing that comes to mind when we’re just talking about that meeting in particular.

Getting a bit more into the detail of the other thing that you mentioned, the emails where Phil Bryant is directing spending. I’d love to see those too, if you got ’em. We may already have them, but just to make sure that we are seeing everything that you’re seeing, I’d love to see them, especially if they’re public documents. The thing that I would say, regardless of what those emails say, the thing that I would point out too, is that: Let’s take a hypothetical. Let’s say that Bob Anderson goes over to Tate Reeves’ office today. And Tate Reeves says to Bob Anderson, “Bob, I’ve got a really good idea. I want you to spend TANF money on a community garden in inner city Jackson, and you should do it in this way, and this way, and this way.” And the way he describes it, violates TANF regs. Is it Bob Anderson’s responsibility to then say, “Yes, governor, I will do whatever you’re telling me to do”? Or is Bob Anderson’s responsibility to say, “Governor, actually, the way you described it violates TANF regulations and we can’t do that with that money”?

Now my personal position is that it is Bob Anderson’s job to do the latter. It’s his job to do the latter. Another sub question there would be, is it the governor’s responsibility in that hypothetical that I just set up to know all the TANF regs?

MT: Right.

White: The answer is no. If that is the governor’s responsibility, then it is impossible to be the governor of the state of Mississippi or any state, because you would have to be an expert in TANF regs, MEMA regs, DPS regs, and every federal grant that is drawn down by any of those entities. It would be impossible.

MT: Yeah, no, I get that. But so, the governor going to a state agency head and saying, “I want you to fund this,” isn’t that inherently improper? I mean, they’re supposed to be bidding to figure out who gets money. You’re not supposed to be able to go to a state agency and say — Maybe you could go to the state agency and say, “Hey, put out an RFP for this particular service that I’m interested in us providing to citizens,” but to go and say, “You need to fund this group”–

White: Fund specific vendors, is that what you’re saying?

MT: Yeah, yeah.

White: Because it’s two very different things for Tate Reeves to say to Bob Anderson, “Hey, I want a community garden with TANF money in inner city Jackson,” and for Tate Reeves to say, “I want this specific company to win this contract to provide a community garden in inner city Jackson.” Right?

MT: Yeah.

White: So just to be clear, you’re saying that there is proof of the latter and not the former.

MT: Yeah.

White: Is there a proof — What proof are we talking about here? Are there emails? Is it John Davis’ word?

MT: There are emails that describe Phil Bryant asking for a group to be funded by John Davis. And I’m not saying that that group doesn’t satisfy TANF purposes. I’m just calling into question why the governor would be telling him to fund a specific group in the first place.

White: Is the email from Phil Bryant, or is it from John Davis to somebody saying, Phil Bryant—

MT: No, no, no. It’s from Phil Bryant.

White: (Long pause) Cause I don’t know that I’ve ever seen anything quite like what you’re describing.

MT: OK. I mean, does that make you feel differently?

White: I would say that if there’s any sort of violation of bid laws where anyone in a position of power is saying that a specific vendor needs to be funded, and that would be in violation of bid laws or procurement laws, then yeah, there’s a problem. That’s just an obvious, I think that’s obvious.

MT: Yeah. And I don’t know that it is in violation of bid laws because I don’t know what law says that you have to bid TANF projects.

White: So these are specific TANF projects that you’re talking about?

MT: They were funded with TANF dollars, but I don’t think, I don’t think Phil Bryant was going to John Davis saying, ‘Can you fund this with TANF?’ I think he was saying, ‘Can you fund this for me?’

White: I mean, so this is getting a little complicated in the sense that there are a lot of ifs in here. So honestly, I’d have to just see what you’re talking about in order to come to an opinion on it, I think. Because there are a bunch of twists and turns inside this hypothetical that I’m trying to weave in my mind, of, what exactly is he telling him? And, what’s the tone? Is it, “Hey, if this is legal and allowable, then do this.” Or if that’s not there — all these little idiosyncrasies and small features will end up mattering, obviously.

MT: Yeah, I get what you’re saying. I think that for my purposes, the communication that I have, I’ve seen this a while ago and I didn’t think it rose to the level of its own story.

White: Yeah

MT: I don’t know that I feel that same way right now, because I think it illustrates the relationship that they had, and the kind of orders, or the kind of requests that Phil Bryant was making of John Davis that get a little further at the question of whether Phil Bryant should be held accountable for the misspending of this money.

White: Yeah. And let me tackle the question in a different, more generic way than just speaking specifically about these emails and that sort of thing.

MT: Yeah.

White: If John Davis believes that Phil Bryant has some sort of culpability here, then it’s obviously in his best interest to disclose all of that as soon as possible, whether it’s to me, or if he doesn’t want to disclose it to me, to the FBI, or federal prosecutors, or Jody Owens, or any of the other parties that are capable of seeing this, who have cases under their jurisdiction or investigations under their jurisdiction related to this.

MT: Yeah.

White: It is in his best interest to do that. And you would think that if he has anything like that, he would have taken it to one of those parties at some point before now, but he’s still free to do that.

MT: But if the nature of their relationship was where Phil Bryant would express what he wanted to John Davis and John Davis would make it happen, I’m not sure at what point Phil Bryant should be brought into the conversation of who is responsible for the misspending. Because John Davis didn’t — I don’t think John Davis personally spent $77 million dollars.

White: Well, here’s the thing. Let’s fast forward the clock a bit. Let’s say John Davis doesn’t pay anything on this demand. And let’s say that the Attorney General’s office sues John Davis in civil court to enforce the demand. If John Davis believes that he might be legally responsible for repaying any of that money because he was directed to do so, or because of the relationship between him and Governor Bryant and because the nature of the relationship absolves him of some sort of liability, he’s got the opportunity both now and at trial to present all that information.

But let’s go back to the hypothetical that I had a moment ago, where Bob Anderson is in Tate Reeves’ office. And Tate Reeves says to Bob, “Go make the community garden.” Now, Bob might say, “Well, it’s just our relationship that if Tate Reeves tells me to do something, I go and do it.”

Does that absolve Bob Anderson of responsibility for spending that money appropriately? No. In fact, regardless of how Bob thinks about his relationship with Tate in that hypothetical, Bob is going to be held responsible for whether or not that money is spent appropriately and legally. And Tate Reeves is not.

And it doesn’t matter that Bob thinks, “Well, it’s just this unspoken rule in our relationship that if I don’t do this, that I’m going to be fired.” That doesn’t matter. If someone comes into my office today and tells me to do something that I don’t agree with, that is a violation of law. I’m not going to do it.

If I were working for the state auditor and the state auditor walked into my office and told me to do something illegal, it doesn’t matter that I would be fired. I have a responsibility to not do it. So, in the hypothetical, Bob Anderson still doesn’t have proof of something that absolves him of responsibility.

MT: Yes.

White: I’m trying to figure out if what you’re describing is like that, when you’re saying “the relationship between John Davis and Phil Bryant.”

MT: Yeah. I think that gets close to it, but that’s the thing, I’m not saying that John Davis shouldn’t be held accountable. Can’t two people be held accountable? And if it’s not going to absolve him, why would he bring it up?

White: But the following question to that is, if you’re going to bring it up and think it absolves you, then why have you not presented it to any of the legal authorities, whether it’s me or the AG, federal prosecutors, and state prosecutors or anybody else? Why have you not presented that information to get yourself off the hook?

MT: No, because I don’t think he thinks it’s going to absolve him. I’m just saying there’s another person that should be also held accountable – potentially.

White: So he thinks that even if it doesn’t absolve him, that it could implicate Phil Bryant, and for whatever reason, he’s just not going to disclose that information.

MT: He’s probably, I would imagine, taking all of his cues from his defense counsel. So I’m not trying to get in his head, I’m just saying, regardless of what John Davis decides to do or say, or try to defend himself, there was another person who also is responsible for the money being spent properly.

White: But not in the same way. Not in the same way, I would say. Because again, go back to the Tate hypothetical. Is Tate responsible for knowing all the TANF regs? No. He’s just not.

MT: But if he’s just like telling an agency head to help out his nephew or fund this school that he wants to see funded because it’s going to go down otherwise. He’s not supposed to do that, no matter what money or what purposes the money was supposed to be going towards. Throw out the whole, “Does it serve a TANF purpose?” and just look at, is a governor supposed to be telling a state agency head who to fund? Or who to help out? Or if their friend needs their mom to get on the Medicaid waiver, he’s going to try to get the state agency head to help this person get on the program? You know, these are the examples that I think about when I think about the way that Phil Bryant may have had influence over John Davis’ actions.

White: Yeah. I mean, again, if there are specific instances where there’s specific language, where Phil Bryant is instructing John Davis to do X, Y, or Z, I mean, I really would need to see it in order to know if we — meaning me and the attorneys over here and the investigators over here — think that’s over the line or not. But again, the governor is elected and governs for a reason, you know?

So, if Tate Reeves is sitting there telling Bob Anderson, or just to be more specific, I mean, if Phil Bryant is telling John Davis, “Look, I really think that helping children in poor families is more important than helping poor adults. And I think that you should direct your TANF spending to do that as opposed to helping poor adults.” Does he have the right to do that? Absolutely he has the right to do that. He was elected, and as the elected representative of the people, he’s got a right to direct the agencies that answer to him under the law, according to his policy preferences.

MT: Yeah, no, I don’t think anyone’s arguing against that.

White: The question that you’re posing is what happens when you get more specific. And what happens if what he is suggesting to Davis does violate a reg. So, just say a reg, not a criminal statute or something like that, let’s say a reg. Again, I would just maintain that it is the agency head’s responsibility to say, “No.”

I’ll give you another example, if I walked over to the Lieutenant Governor’s office and the Lieutenant Governor told me, “Shad, the state auditor’s office will do XYZ this year, or we will cut your budget in half.” And I know that XYZ is illegal. It is my responsibility to say, “Lieutenant Governor, you may not know this, but XYZ is illegal and I will not be doing that. And you can do whatever you like to me as a result, but I will not be doing that.”

It is my responsibility because I would be the one who is held ultimately accountable for knowing the rules and regs and statutes that apply to my operations in my agency. And I don’t even necessarily think that the Lieutenant Governor would have reason to know some of those things.

In fact, it’d be impossible for the Lieutenant Governor to know all those things because he’s funding every state agency.

So there’s just a big onus that comes with running a state agency. And I feel like I can say that with some credibility, because I run a state agency. I’m responsible for complying with all the rules and regs that are applicable to me, every single day.

MT: Right. I guess I recognize that there might not be a path forward with the types of laws and things that you enforce, and I worry that like the larger, sort of, culture of state government, is not going to be addressed or taken down in the same way that these alleged embezzlers are.

What do you think about that?

White: This is actually something that runs through my head a lot and I’ll tell you why it runs through my head a lot. So, we get a call, let’s just say, again, this is a hypothetical, made up facts, but it’s very similar to things that we deal with all the time.

I get a call from a resident of a county. And the resident of the county says, “Look, my board of supervisors down here misspent a ton of money and I think they maybe even stole some of it.” So we go and we look, and as it turns out, the board paved a road that was barely driven on, which is totally legal, but is a complete waste of money.

And then on top of that, one of the board members received a kickback. So, we arrest the board member for the kickback and send him to jail. He gets prosecuted. But then the person who called the tip in, in the first place says, “Yeah, but they still spent the money on that road.” What is the recourse to hold them accountable for the money they spent on the road that was wasteful?

And the answer is, if there’s no criminal statute that applies to the actions that took place, the answer is that you have to vote those people out. And then the person who’s on the phone with me gets frustrated because they say, “Well, I don’t have unilateral power to vote these people out.” And so you have to go back to this point of: democracy is frustrating sometimes, but it exists for a reason.

And the reason in this case is that the voters get to decide whether or not the policy choices by an individual or the way they handle their business is something that they want in office or not. And that’s really where the accountability falls if there’s no statute that’s been triggered.

So I do think about it a lot, but there’s not a perfect answer to this because there’s not supposed to be a perfect answer. No one person’s judgment is supposed to rule the day. We decided to outsource those kinds of decisions to the voting public. And that’s just where the decision lies and that’s where the accountability has to lie, too, if there’s no statute has been violated.

MT: Yeah. If there’s no statute that’s been violated.

I think that the problem that I have, and that really bugs me about this story, as I learn more and more, especially looking at the forensic audit and seeing the different characters who are totally outside of the story that has been told, but these contractors who are politically connected getting these big contracts to do little to nothing. And you’ve talked about this before, the way that you’ve talked about these issues, it’s like, you’re pissed that money didn’t go to people who needed it. And in the case of corrections, you seem to express empathy for people who needed to be rehabilitated, who were not because money was not spent properly at the department of corrections. So these are just examples. It seems like you want things to be done more ethically, even if there’s no laws being broken by the actions that are taking place right now. And so how do we accomplish that?

White: Well those instances would be laws being broken, though, right? It would be if a parole officer is embezzling funds from prisoners–

MT: Well, yeah, but I’m not even talking about a parole officer, I’m talking about–

White: I take your point, keep going.

MT: I’m talking about the department of corrections commissioner taking a whatever, hundred thousand dollar buyout, illegal buyout, and has never been held accountable for that. You know? I mean, she didn’t, I guess, violate a specific statute or something, but you still express through your written reports that that was improper.

White: I would say she did violate a specific statute. So what we do when we audit is if you read something in an audit finding, the finding is describing spending that did appear to violate a statute or a reg. So I would say that, just like the comp time buyout of John Dowdy at the Bureau of Narcotics, which we audited, you know, that buyout was not appropriate under the law and he had to pay it back.

So in these situations that you’re describing, so far at least, we have both, we have something that is both unethical and illegal.

MT: So does anyone get charged with a crime?

White: Well, you know, criminal statutes and civil statutes are different in what we look for, this is just generally speaking about criminal statutes.

What we look for to see if there’s a violation of criminal statutes is, we’re looking for things like a personal benefit to someone, if it’s an alleged embezzlement. And we’re looking to see also that they intended to do this, knowing that what they were doing was not allowed. So, when you get to that point, when you’re trying to figure out if somebody intended to do something, you have a problem in the law, which is you’re trying to step inside their head, but that’s impossible. Right? So what do you do?

You look at circumstantial evidence to see if it seems like they knew what they were doing. So you looked to see if they concealed what they were doing while they were doing it. You look to see if they covered their tracks. Inversely, you would look to see if they were very open and apparent about what they were doing.

Did they walk down the hall and tell everybody, “Hey, I just bought a new Ferrari with the agency’s money. Isn’t this great? Everybody come down and see the Ferrari.” I mean, weirdly, that is proof that they were dumb and didn’t know that what they were doing was illegal. So we look at intent. We look at whether or not there’s a personal benefit. We look at whether or not they make fraudulent statements on a government document. And again, every fraud statute in every state in the country has an intent element, which means we have to show that they intentionally decided to lie and conceal what the truth was. So that’s where, speaking broadly, that’s where the line is between a civil case and a criminal case.

But, all that to say, the state auditor’s office is not in charge of deciding whether something is a civil or criminal case. We do not have that legal authority at all. We are an investigative body. So we go out, we identify facts. We figure out what actually happened with spending. And we ultimately present those facts to lawyers, prosecutors outside of my office, the AG’s office, the local DA, federal prosecutors. Prosecutors make charging decisions. Prosecutors are the ones who decide, “OK, well this, this is not just civil. This is criminal. And we’re going to take this to a grand jury.” And then of course, if it goes to a grand jury, a jury of a person’s peers is going to decide if the individual is indicted or not. So that’s how I think about it.

And that system has worked well because there are tons of different safeguards in there. And there are provisions in there that prevent any one person from being too powerful. And that’s, I think, important to remember in this case, is, I mean, you can see it yesterday or whenever it was that we released the demands. People say, “Well, why aren’t all these folks going to jail?” And they question whether or not I am fully doing my job because they’re not in jail. Well, they forget that I don’t make charging decisions.

MT: Yeah.

White: I don’t have that power. I absolutely do not have that power. I could not haul somebody into jail right now without having an indictment and a reason to believe that they have committed a crime. I just don’t. So if they have a problem with that, they have to take it up with the prosecutor.

MT: When you’ve given information over to prosecutors, have there been times where you felt like they didn’t follow up on something that you would have expected them to?

White: You’re talking about just in general with any case?

MT: Yeah, but also within this welfare stuff, certainly. How much are you guiding them through the information you’re giving them? Do you hand over the documents and are like, “These are the six guys who really did something?” Or is it more like, “Here’s a group of people who may have done something,” and the prosecutors are the ones that picked out the six guys.

White: To go to one end of the spectrum, there’s never a world in which we will dump 30,000 pages of documents at a prosecutor and say, “Hey, figure it out.” That’s not gonna happen. That literally has never happened, will never happen. They would just laugh at us. And then they would probably never take our cases ever again if we started doing things like that.

So your question is, “How specific do we get when we present files to the prosecutors?” I mean, we will look through files and spend time figuring out who we think has violated a criminal statute and speaking generally, because I don’t want to get too specific about DHS criminal cases, speaking generally, we’ve taken cases to prosecutor’s offices said, “Hey, here’s a summary of four different violations of criminal statutes by three different people that we think happened. What do you think?” And sometimes prosecutors agree with us and sometimes they disagree. In addition to that, especially if it’s a case that has a federal nexus, usually what happens if we do that with a federal office, is they say, “Thank you for your recommendation on these three people that violated those four criminal statutes. We’ll take it from here.” And usually the federal prosecutor will take the documents and take whatever we’ve said and hand it over to the FBI, and then they will do their own digging and come to their own conclusions about who should be liable for what.

So that’s kind of how that works. Is there a frustration between agencies over whether or not everybody who got indicted should have been indicted? Yeah, sometimes. But that’s just natural between law enforcement entities, I think. That’s a common occurrence. People have differences of opinions because when you have a bunch of smart people in a room who are looking at the same facts and looking at the same law, they can differ on what the application of the law should actually mean.

And that’s just to be expected, I think.

MT: Yeah. So going back to the things that you’ve said, that kind of, to me, illustrate your mindset about the way that public funds are supposed to be spent. There’s no body, there’s no agency in charge of that in Mississippi.

White: You mean how public funds were supposed to be spent generally at every agency?

MT: We’ve talked about this before, how your office can’t have a role in making sure an agency’s spending is effective or that they reach intended outcomes. So whose role is that?

White: Yeah, it’s the role of the agency. You’re right. That there is no big oversight body that runs, that manages spending for state agencies.

MEMA ultimately has responsibility for wisely and legally managing the funds that have been handed to them. And so too does DHS, and so on.

MT: Yeah. So that’s problematic that the agency gets to spend, gets to decide how it spends the money, and there’s no one looking out for whether that money is actually being spent the way it’s intended.

…What I’m talking about are purchases that are not illegal. But they also don’t satisfy the intended purpose. There’s no one checking to see if money is being spent in the way that will accomplish the goal.

White: I don’t know that I agree with that because if you spend money in a way that does not conform to the goals stated in statute of TANF, then you’ve spent money illegally. And so then that would trigger our authority.

It sounds to me like what you’re saying is some sort of area in between where an agency is spending money legally in a way that conforms with the stated goals in statute of TANF. But that’s just not a good use of funds.

MT: No. Or that it just doesn’t meet the goal.

White: If it doesn’t meet the goal though, I’m saying it’s actually illegal.

Editor’s note: The interview delves into specific examples in the forensic audit.

MT: The way that he was charged with going about helping people get jobs, did not help people get jobs. Not necessarily because he didn’t do the work, but because the work that they had him doing didn’t satisfy the goal. I mean, I think it’s happening all the time where we’re giving contracts that say, “Hey, you go do this thing.” And people just kind of flail around and don’t actually accomplish anything. And that’s perfectly legal.

The terms of the contract are satisfied, but they didn’t accomplish anything.

White: Yes. And so I’m tracking now, so the contract, as it is written describes a legal use of TANF money.

MT: Right.

White: But then the way the contract is executed just means that the money doesn’t actually help anybody, something like that.

I think that if that is the case, then again, the accountability comes back to the governing entity of the agency, whether that be the governor who appoints the agency head or the board who appoints an agency head. Because what you’re really talking about is mismanagement, right? You’re talking about legal activities, but activities that don’t make anyone’s life better.

And if that’s the case, then the accountability has to fall on whoever’s overseeing that agency. And in some cases, that’s the governor, who’s elected by the people and can be unelected by the people. And in some cases that’s a board, but the board is appointed by usually the governor or someone else.

So that’s where the accountability lies. I get the frustration. I get that it’s messy, but that is the system. That is it. And it’s important to think about the inverse of that system to what would it look like for one person to have oversight over all these agencies and to be able to decide unilaterally what mismanagement looks like. That would be a lot of power for one individual or for one body or something like that.

MT: I would think that the legislature would be held more accountable for that because they’re the ones setting the budgets and they don’t require the agencies to show that they need the money to satisfy a goal and then come back the next year and show how that goal was actually satisfied with the money that they were given.

White: No, that’s a great point. That is a great point. And I should have mentioned that. So you do have two forms of oversight. Let’s take DHS to be specific. You have the governor who appoints the head of DHS. So he is the person who is elected by the people to make policy decisions about what DHS is going to do and should be held accountable for that agency functioning well, through his appointee.

But also you have the people funding the agency, right? And they too, I think, bear responsibility to make sure that the money is well spent and they should ask hard questions about where that money is going. And and I can tell you, I think that if I misspent half of my budget here in the state auditor’s office, I would certainly hope that appropriators would come back to me and say, “What you are doing and how you are running your agency may be legal, but it is not appropriate because you’re wasting a bunch of money and we’re about to cut half your budget.”

MT: Which ultimately doesn’t help anybody. It still doesn’t help the person that the agency should be helping. But the last point I wanna make is just –

White: We’re getting very philosophical by the way.

MT: I know, I’m sorry.

White: I feel like we’re getting down to, like, is democracy good, now—

MT: (laughs) I don’t know how else to do my job.

White: I think you and I might come out on different sides on the “Is democracy good?” question.

MT: Let me, I just want to make one more point about the way that these agencies are operating very legally.

And what I see happening more and more as I gather examples, and I was not this cynical before I saw all of this. We were under a favor system in this state. That means that the people who are getting jobs in state government or contracts or whatever you want to call it, are people who already had wealth and power and the state is letting them maintain wealth and power. While no one else has the opportunity unless they were born with it.

White: But what about me?

MT: What about you? You don’t think that describes you.

White: It does not. I don’t think that describes me.

MT: Yeah.

White: So how does someone like me get into this position without being born into it, if the premise that you just set out is true?

I have no doubt that there are places where somebody’s daddy, who’s influential calls somebody else and gets them a job. That just happens in life. But I also have no doubt that there are times, including in state government, where people get into positions of power, regardless of who they were, who they are, or who their parents are or where they’re from.

I have no political connections. I grew up in a town of 700 people. My dad’s an oilfield pumper and my mom’s a school teacher.

MT: Yeah.

White: The first time they ever met a governor was when I worked for one. I don’t think what you said is totally true

MT: Well, you’re an exceptional case. I mean, you’re like a Rhodes Scholar. That’s a remarkable position to be in, that you created for yourself. It’s not common.

White: I don’t know. I don’t have a good way to assess how many people got into their jobs based on family and historic power and wealth versus something else. I just don’t.

Look, here’s another thing. I think sometimes people confuse agreement with ideology with coming from a privileged background. So for example, I saw the other day that somebody had criticized me for coming from privilege and not understanding what DHS was or what TANF dollars were intended to do. Now, that’s somebody who obviously has no idea who I am. They haven’t even bothered to Google me or figure out what my path was to this point. I think they leapt to that conclusion probably because they disagree with me politically. And they just assumed that somebody who’s a Republican, who’s in charge of something, must’ve come from privilege, which is just not true.

So we have to be careful, I think, to avoid falling into that logical trap. But, to your point, yeah, I do think that there are absolutely situations where people get jobs because of who they know, who their parents were, how much money they have, all that kind of stuff. And I don’t like that. I really don’t. You can ask my wife, I complain more about that, about people being born on third base and getting to home and thinking that they have accomplished something great–

MT: Yeah.

White: –than almost any other societal problem. But it doesn’t mean it is the universal rule in Mississippi, and I honestly don’t have a way of assessing whether or not Mississippi is any worse in that regard than anywhere else.

MT: Right. Well, going back to Phil Bryant, the Phil Bryant question is lingering and is not going to go away — how much responsibility he had or should have had for the misspending of tens of millions of dollars that. How does one person misspend tens of millions of dollars by himself?

That’s a system. That’s a broken system. That’s not a broken person.

White: Well, I do think you could say that it is a broken system and still believe that John Davis was the final arbiter of all these decisions, because John Davis didn’t misspent $77 million. John Davis misspent a bunch of money, and then he handed a bunch more money to MCEC and FRC, who he then failed to monitor, who also misspent a bunch of money. So, it’s definitely a system. There’s no doubt about that. It’s not one guy stroking checks day after day, spending the money himself minute by minute. You’re exactly right. That would be very difficult for one person to do. But it wasn’t one person.

And let me just take one step back, too, and talk about Mississippi in general, because now we’ll get to a point where I do think that some problems here are more acute than in other places. One of the reasons why this entire ecosystem of fraud was allowed to develop was because there was almost no oversight over nonprofits in Mississippi.

MT: Yeah.

White: So you have nonprofits operating out there sometimes without boards.

MT: Yeah.

White: You have nonprofits operating out there, who, the only way that they are subjected to regulatory oversight is through submitting some documents occasionally to the Secretary of State’s Office and 990s, and a couple of other things.

The Secretary of State’s Office doesn’t have investigators who are going around and looking for misspending at non-profits.

So yes, there is a system here that was, I don’t know that you would say it was put into place, but it existed, that allowed $96 million dollars, let’s call it what it is because of interest, $96 million that was misspent.

And I think there need to be real policy questions asked about why that system is the way it is. And I understand your argument about privilege and all that stuff. I, speaking honestly, I think those are the wrong questions. To me, the right questions are, “Why is it that nonprofits have no oversight in the state? Why is it that the accountants who audited FRC and MCEC have not been held accountable for their audits of those institutions?” You know, these are the kinds of things that when coupled together, create an ecosystem for fraud. It’s like a plane crash. A plane only crashes if there are multiple redundant systems that failed and what you have is multiple redundant systems failing.

I don’t know that I would wake up and say, well, is the thing that is failing in Mississippi the fact that a bunch of rich, privileged people who only belong to rich, privileged families are in charge of everything. That’s just not true. I just don’t think that’s true. Phil Bryant is proof that that’s not true, actually.

But is there a better set of questions to ask about why a system exists and what the underlying drivers of the system are? Yeah. I think there’s a whole bunch of questions to ask about that. And I think that the answers to those questions require a ton of hard work and a ton of thinking about why Mississippi is the way it is, why we have set up the policies in the way that we have set up.

The post State Auditor Shad White discusses welfare investigation, former Gov. Phil Bryant appeared first on Mississippi Today.

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