Vanlandingham Pleads Guilty in Mississippi Welfare Scandal

JACKSON, Miss. – Five years after officials named his company in the “largest public embezzlement case in state history,” Florida neuroscientist Jacob Vanlandingham has pleaded guilty to one federal charge of wire fraud.

Vanlandingham is the latest defendant to admit to some role in the Mississippi welfare scandal, which ensnared his former business partner, retired NFL quarterback Brett Favre. The Mississippi Department of Human Services alleges that the two worked together to channel funds from the federal Temporary Assistance for Needy Families program to their pharmaceutical startup, Prevacus.

But acquiring $1.9 million in federal welfare funds from the poorest state in the nation to develop a drug to treat concussions — an allegedly illegal use of the funds — was not Vanlandingham’s crime. Instead, he pleaded guilty to using some of the funds for himself, including for “gambling and paying off personal debts,” according to a federal court file.

Reached on Wednesday, Vanlandingham expressed concern that his guilty plea might be misconstrued as an admission of stealing welfare money. “The case was very complicated but it really boiled down to one count of wire fraud, not any finding of welfare fraud,” said his Florida attorney, Thomas Findley.

Both Favre and Vanlandingham have denied the allegations in the ongoing civil suit, and Favre has not been charged with a crime. Vanlandingham founded Prevacus in 2012, with Favre as one of its largest investors and promoters. The startup is now defunct after selling the idea of its concussion drug to another company.

Prevacus and the MCEC

In January 2019, Prevacus entered a $1.7 million contract with the Mississippi Community Education Center, a nonprofit entrusted by the state welfare agency, Mississippi Department of Human Services, to spend millions of federal grant funds. The charge alleges that Vanlandingham unlawfully enriched himself by making materially false and fraudulent representations about using the funds to develop a pharmaceutical treatment for concussions.

Vanlandingham pleaded guilty to a bill of information, a charging document the government uses when a defendant agrees to waive a formal indictment. He was released on a $10,000 bond on Wednesday. The charge relates to a $400,000 wire transfer from Mississippi Community Education Center to Prevacus on July 16, 2019, about a month after the state auditor’s investigation began.

The single count of wire fraud carries a maximum sentence of up to 20 years in prison and a fine of up to $250,000. Vanlandingham’s sentencing, along with the sentencings of six others who have pleaded guilty, has not been scheduled as each defendant continues to cooperate with federal investigators.

2020 Probe

The federal case against Vanlandingham stems from a probe that began in 2020 into the misspending or theft of federal public assistance funds. The investigation started after State Auditor Shad White, who originally investigated a tip brought forward by an agency employee to then-Gov. Phil Bryant, made six arrests and turned the case over to federal authorities in February 2020. Auditors estimate between $77 million and $98 million was misspent or not properly documented.

“I applaud federal prosecutors for their continued work on this case,” White said in a press release Wednesday. “I’m grateful for my team at the Auditor’s office and the FBI for digging up the facts related to this case. We will continue to assist federal prosecutors as needed going forward.”

Ongoing Legal Proceedings

Welfare agency director John Davis and nonprofit founder Nancy New both pleaded guilty within the scheme in 2022 but have not been sentenced. An additional four defendants have pleaded to state or federal charges between 2020 and 2023. Each defendant has agreed to aid federal authorities in their ongoing investigation. The trial for an eighth defendant, former professional wrestler Ted “Teddy” DiBiase Jr., is scheduled for January.

The bill of information against Vanlandingham was signed by Todd Gee. Gee, a U.S. attorney in the Southern District of Mississippi, left the U.S. Department of Justice’s Public Integrity Section to fill the Jackson-based appointment. It was also signed by two senior officials from the U.S. Department of Justice — Glenn S. Leon, chief of the DOJ’s Fraud Section, and Margaret A. Moeser, chief of the DOJ’s Money Laundering and Asset Recovery Section — signaling Washington’s role in the ongoing investigation.

Many of the crimes associated with the welfare scandal have a five-year statute of limitations.

Mississippi Today first published this article, and it is republished here under a Creative Commons license.