State auditor seeks to recover almost $3 million in state, including $422K from tourism commission


State Auditor Shad White recently announced his office is seeking to recover almost $3 million in misappropriated funds from organizations throughout Mississippi, including more than $422,000 from the Hattiesburg Tourism Commission.

The Audit Exceptions Report, released last week by the auditor’s office, shows White has issued 43 formal demands to recover the funds from the tourism commission, as well as the Mississippi Military Department, N.R. Burger Middle School, Oloh Volunteer Fire Department and a former Lamar County Deputy Tax Collector.

“I am proud of the exceptional work of our staff,” White said in a statement on his office’s website. “This report is the result of the hard work of our investigators, other staff, and former Auditor Stacey Pickering. I’m thankful for what they did for the taxpayers of Mississippi.”

The report states an informal demand in the amount of $422,914.92 from misappropriated funds was made on Nov. 17, 2016, to current and former Hattiesburg Tourism Commission members Marshall Bell, Sandra Foster, Frank James, Dr. Cathie Price, James Ratliff, Chris Rowell and Bonnie Warren. For Fiscal Year 2018, no payments have been made.

At the time of the demand, Rick Taylor served as the executive director of the Hattiesburg Tourism Commission and the Hattiesburg Convention Commission. Taylor now serves as executive director of the convention commission, while Marlo Dorsey serves as director of the tourism commission.

On Aug. 17, Dorsey released a statement stating the demand was for the repayment of “unauthorized employee bonuses and retroactive payroll payments” made from 2008 through 2013.

“Members of the Hattiesburg Tourism Commission are unpaid volunteers, and the Auditor does not allege any intentional wrongdoing or improper payments to any commissioner,” the statement reads. “However, according to the demand, each commissioner listed is responsible for their portion of paying back these employee compensation payments, plus incurred interest and investigative costs.

“The Hattiesburg Tourism Commission discontinued this type of payroll practice in 2014 and, in 2016, retained legal counsel for inclusion at its commission meetings and for overall compliance of its internal processes. Additionally, the Hattiesburg Tourism Commission maintains an errors and omissions insurance policy and has demanded the insurance company resolve these issues presented by the Auditor as quickly as possible. The Hattiesburg Tourism Commission and its legal counsel have worked cooperatively with state officials throughout the Auditor’s investigation and money recovered will be returned to the Hattiesburg Tourism Commission.”

Taylor said because he is no longer an employee of the tourism commission, he has no authority to comment on behalf of the commission or the individual commissioners.

The report goes on to state a formal demand in the amount of $157,385.40 was issued on Sept. 11, 2015, to the Mississippi Military Department for embezzlement on the part of Jerry Howard, former manager of the MS Youth Challenge Dining Facility. Howard pleaded guilty to the charge in December of that year and was sentenced to 10 years in custody of the Mississippi Department of Corrections with eight years to serve and five years of post-release supervision.

In August 2016, Howard was ordered to pay $100,461.96 in restitution to the Camp Shelby Youth Challenge Program and $56,923.44 to the state auditor’s office. For Fiscal Year 2018, payments have been received in the amount of $125, leaving a balance of $157,260.40.

A formal demand was issued to N.R. Burger Middle School in January 2017 in the amount of $4,763.10 for misuse of public funds by former bookkeeper Sheva Bland. The case was transmitted to Attorney General Jim Hood’s office on March 5.

A statement released by Hattiesburg Public School District officials said administrators discovered the discrepancy in January 2012.

“The incident was immediately reported to Central Office, the State Auditor’s Office and the appropriate authorities,” the statement says. “An investigation was conducted by HPSD and the employee was terminated shortly thereafter. It is our understanding that this matter has been transmitted to the Office of the Attorney General.”

A formal demand also was issued to former Lamar County deputy tax collector Susie Dobson in September 2015 for the amount of $30,551.60 for misappropriation of funds. Dobson pleaded guilty to embezzlement in September 2016, and was sentenced to serve three years in the custody of MDOC with three years suspended. She also was ordered to pay $22,300.44 in restitution.

For Fiscal Year 2018, payment in the amount of $900.22 has been received, leaving a balance of $19,099.16.

Oloh Fire Department was issued a formal demand in August 2017 in the amount of $40,693.84 for misappropriation of funds on the part of former secretary Michelle Barefoot. For Fiscal Year 2018, payment of $22,993.89 was received from an insurance company, leaving a balance of $17.699.95.

White said the next step to recover the funds will need to come from Attorney General Jim Hood’s office.

“We don’t have the power to take anything to court,” he said. “What we have the power to do is investigate something and build a file, and then we have to forward that file either to the Attorney General’s office or to federal lawyers or a local district attorney.

“At that point, the negotiations about how the money is paid back and the time frame and that sort of thing, typically revolve around the folks who have received the demands and the attorney who is moving the case forward. So in this case, we forwarded our findings to the AG’s office, and it’s my understanding that they’re dealing with the folks who were given the demands.”

For the full Audit Exceptions Report, visit