DMR Scandal day 53: The bucks are beginning to stop.

The scandal at DMR is growing exponentially with the addition yesterday of Madison County Tax Assessor Gerald Barber and his wifey Elizabeth Rooks-Barber to the party.  Madison County is where all the rich white folks that didn’t flee Jackson to Rankin County ended up.  😉

It appears the Sun Herald has all hands on deck as 4 of their reporters checked in yesterday with two stories, the first linked above by Anita Lee, Karen Nelson and Paul Hampton which detailed how the DMR engaged in bid rigging via split purchase fraud steering work to Barber and his wifey.  We also back the date up on the OIG involvement to mid July, 2012 which is significant as it implies the Interior Department was looking at DMR since at least May, 2012 based upon my professional experience, perhaps even earlier.

Michael Newsom wrote a cradle to corruption history of the DMR yesterday as well that is a must read for background.  I think the Louisiana chapter of the Slabbed Nation will find this scandal worthy of their attention thus the Sun Herald is also timely signalling their intent to take this story home with a DMR page which has links to all their reporting on the scandal.  This in turn implies they agree with the community’s assessment this story will be huge in its scope and reach, having already ensnared the likes of the Land Trust for the Mississippi Coastal Plain and it’s Executive Director Judy Steckler, who allowed the organization to be used as a money laundering vehicle by DMR to hide a specious father-son land deal funded with CIAP funds.  Frankly it is not too soon to drop that dreaded 4 letter acronym RICO as predicate acts abound in the emergent fact patterns. Despite that fact Mississippi Governor Phil Bryant remains in hiding along with the Commission on Marine Resources.   Mississippians deserve far better from their elected officials.

There is a larger story here in the complete lack of state oversight and self accountability, which at first blush is ironic as Bryant started out in state-wide politics as State Auditor.  Once upon a time the State Auditor’s Office actually had a fair amount of auditors in several different divisions from Higher Education to local school districts.  The auditing these folks did was very good though I’ll grant they tended to over-audit.  Through time the capacity to conduct audits at the OSA has diminished to the extent where I think everything is now contracted out to private firms.  The audit quality is very uneven.

I mention this because the type of fraud revealed by the Sun Herald yesterday is fairly easily caught in a well designed audit but I think it also illustrates the environment that Walker perceived he was operating to so blatantly split purchases to steer work.  We also now have a window on how County Government operated because the first set of preliminary findings included County procurements including this blurb on the Hancock County Board of Supervisors:

OIG 7-20 DMR Report Excerpt 1

Contractor C? Contractor D?? This is getting interesting as this sounds like language the Department of Justice would use with Grand Jury material. I believe the engineering firm in question would be Compton Engineering as we continue:

OIG 7-20 DMR Report Excerpt 2

At this point I know there are several people here in Hancock County shouting EUREKA because these three paragraphs tie so much together.  One party to the Bay Tech Building Swindle would have a prominent role in the above but the rumors of a second party to the Bay Tech swindle being involved in the Water and Sewer biz now come into much sharper focus.

Stay tuned.

6 thoughts on “DMR Scandal day 53: The bucks are beginning to stop.”

  1. Doug, I understand well from your background that governmental auditing is an useful tool. But I’ll note to you that in spite of the fact that decades of auditing occurred, NOT ONCE and to this day, THERE HAS BEEN no finding whatsoever on the “diversion” of funds aka mineral royalties involving various schemes on the local and state level – even after being investigated and disclosed by others. And based on knowledge, and as seen in Jefferson Parish usually the “audit” is a shield for government looting.

    1. The fatal flaw in the process of the auditee selecting the auditor is the fact auditors that are too diligent will be one and done about 90% of the time. Occasionally there are organizations that use the process as a tool to improve but most take the shortcut. I saw where it was headed over 10 years ago, eliminated the specialty from my accounting practice and made more $$$ doing less work as a result. I still audit, just not local governments.

      A much more topical massive audit failure can be found over at the Housing Authority of Jefferson Parish, a client of Rebowe and Company if memory serves. Missing what the OIG found there borders on the criminal. Well worth noting that it is not unprecedented for a willfully negligent CPA/Auditor to get prison time.

  2. One might find the following historical fact has some current effect. When Phil Bryant was our State Auditor there were some suspicious activities in the Jackson County Chancery Clerk’s office and when one of the JC Supervisors contacted Bryant to suggest an audit was in order Bryant’s response was to accuse the Supervisor he was acting suspiciously and Bryant never responded to an elected official’s plea for an audit. Only the in-depth investigative reporting by Alice Jackson brought enough heat on the issue that eventually even Chancery Clerk Lynn Presley’s friends(see then Attorney General Mike Moore)had no choice but to admit Presley was a “thief” after Presley confessed. One suspects a lot of how the tobacco case was tried and decided and other issues involving tobacco money were never uncovered and Presley opted instead to serve 10 years in prison rather than tell the Feds what he knew. . All of this is made possible in Mississippi because of our faulty state charter which allows board, commissions and authorities(which are vast in numbers across the state) to act totally without answering to any” higher controlling authority” and therefore are set up for corruption of the highest magnitude especially without a strong mission initiative by the State Auditor. The solution is a new state charter which provides oversight at every step of the way in which grants, bid contracts and other dispensing of public tax dollars are involved and permits more public access as well providing monetary incentive for whistle blowers inside governmental agencies. .

  3. Yes, what I want to know is why the Gov hasn’t called for Billy Walker to resign. In fact, why hasn’t he fired him? With his wife rolling around town in a top of the line BMW and his son ensconced in a mansion on the beach in Ocean Springs, why should the taxpayers of Mississippi pay any more for his retirement?

    And while we’re on the subject, why hasn’t Tina Shumate been fired for buying her parents’ property in Pascagoula when she was the director of CIAP? CIAP/BOEMRE grants provide within them the restriction that the property shall not be purchased from “friends, family and other relationships”. Why hasn’t Walker fired her? Fire him for tolerating this abuse and graft. In addition, someone needs to take a sharp look at other DMR employees who have hired their relations and friends via outside contracts. For example, Ziegler, Shumate and others have relatives under contract to DMR…outside the box so no one can find them, like that OS Alderman Denyer and his daughter, who received more than $100,000 per year for ???. Please, Karen Nelson, find this out, as they need to go too.

  4. Doug, it may finally come out that there is one person in Hancock County who practically runs the entire county, and lately has gotten a little sloppy about things; maybe about to trip over his own shoes.

    The Bay Tech thing is so bad, not just what happened, but the total lack of interest in state agencies for oversight, it is unbelievable. No insult intended, but Ray Charles and Helen Keller could have seen this.

    I don’t know much about the port of Gulfport, but the Harbor Commission in Bay St. Louis is going to bear watching . Yet another city department that will answer to the Mayor. Currently the building department, and the community reception hall have been cited by the city’s own auditing firm as operating in violation of the city ordinance that governs them, and the mismanagement is affecting city revenue. The council just sits there.

    My conclusion is: you can inform people, you can make them aware, but you can’t make them care.


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