State Auditor Shad White announced Tuesday that agents from his office have arrested former Yalobusha County Sheriff William “Lance” Humphreys and former Yalobusha General Hospital employee Katherine Rotenberry Brown after both were indicted for separate crimes.
The agents working with the Auditor's office delivered a $10,867.30 demand letter to Sheriff Humphreys and a $100,966.03 demand letter to Brown. Both amounts include interest and investigative expenses.
Humphreys was indicted for embezzlement after allegedly stealing nearly $5,000 from the county’s “Inmate Canteen Account” – funds meant to provide educational and recreational resources to county inmates. The former sheriff is accused of transferring money from the canteen account directly to his own personal bank account. The purported transfers were made in 2018 and reported by a Yalobusha Sheriff’s Office employee who was gathering documents to be audited.
“This is, unfortunately, another case where funds intended to benefit prisoners were stolen,” said Auditor White. “It’s the second arrest we’ve made like this in the last month. We will continue to enforce the law to protect taxpayers and other victims.”
A grand jury also indicted Katherine Brown for embezzlement. She is alleged to have embezzled over $70,000 from Yalobusha General Hospital by issuing and cashing checks addressed to multiple hospital employees. Hospital employees filed a complaint at the Auditor’s office after accounting discrepancies were identified.
“Thank you to the agents who uncovered this fraud from a rural hospital,” White said. “We are dedicated to putting a stop to schemes like this and making sure public money reaches those who should benefit—in this case, patients and hospital employees.”
Humphreys surrendered himself to Special Agents at the Yalobusha County Sheriff’s office, and Brown was arrested at her home in Oxford and transported to the Yalobusha County Detention Center. Bail for both individuals will be set by the court.
Humphreys will face up to 20 years in prison or $5,000 in fines, and Brown faces up to 20 years in prison and $25,000 in fines. All persons arrested by the Mississippi Office of the State Auditor are presumed innocent until proven guilty in a court of law. Both cases will be prosecuted by District Attorney John Champion’s office.
A $100,000 surety bond covers the time Humphreys was Yalobusha County Sheriff. No surety bond covers Brown’s employment at Yalobusha General Hospital. Surety bonds are similar to insurance designed to protect taxpayers in the event that public money is misspent. Both Humphreys and Brown will remain liable for the full amounts of their respective demands in addition to individual criminal charges.
Suspected fraud can be reported to the Auditor’s office online any time by clicking the red “Report Fraud” button at www.osa.ms.gov or via telephone during normal business hours by calling 1-(800)-321-1275.
In a similar investigation two former Coahoma Community College employees were caught in one of the largest embezzlement schemes at that time after a year of investigation by the state auditor’s office in September 2018.
That case is pending in Coahoma County Circuit Court and no repayment has been made at this time.
According to state auditor Shad White at a press conference in the Coahoma County Courthouse at the time the charges were announced, the investigation concluded Stacie Neal from the CCC accounts payable business office and administrative assistant Gwendolyn Jefferson embezzled an estimated $758,000 from 2013-17. The embezzled amount, plus the $194,000 interest and $28,000 cost for the investigation add up to the $981,600.64 Neal and Jefferson are being told to pay back $981,600.64.
At the time the investigation was announced, White said the auditor’s office only deals with civil matters and district attorney Brenda Mitchell will make the decision on whether to file charges and prosecute.
“What that file is going to detail is that, from at least 2013 to 2017, these two individuals who were working in purchasing at the community college, were taking government procurement cards and they were going to Kroger,” White said. “They were going to Walmart, here in Clarksdale. They were going on Amazon. Many times, they were swiping the cards. They were purchasing gift cards from the stores. They would take those gift cards and do whatever they wanted to with them.”
White said multiple cards were being used and, as Neal and Jefferson kept everything a secret, the amount of money they were spending increased. He added they were going on to the Amazon website and purchasing items such as watches, shoes and a chandelier.
“That makes this the largest individual demand coming from our office in the past five years,” White said at the time the investigation broke, adding it is the third-largest last 20 years and possibly longer, but the records only go so far back.
The second largest demand amount in the past five years was for $362,689.14 and issued to William “Bill” Walker, former Executive Director of the Mississippi Department of Marine Resources.
Mitchell said, if there is a prosecution, it would be in Coahoma County, but the timetable is a question mark.
Kappi Allen, former executive director of the Coahoma County Tourism Commission, pleaded guilty to embezzlement at a hearing in Circuit Judge Al Smith’s courtroom in Cleveland Wednesday, Feb. 12, 2020.
The prosecution and Allen both agreed Allen embezzled more than $25,000, which means, according to Smith, the maximum sentence is 20 years in prison or a $25,000 fine.
However, the amount of money Allen embezzled while in her position with the tourism commission is still in question. She was charged with embezzling $93,345.34 — more than $56,000 in funds and more than $35,000 for other things such as taking her granddaughter to Disney World.
Allen has been paying restitution as part of her plea and probation agreement with the state.
Suspected fraud can be reported to the Auditor’s office online any time by clicking the red “Report Fraud” button at www.osa.ms.gov or via telephone during normal business hours at 1-(800)-321-1275.