Comptroller: Operator of child nutrition program stole $162,165

News release from state comptroller’s office
A special investigation by the Tennessee Comptroller’s Office has found that Jeannette Jives-Nealy stole $162,165 in federal grant funds. Ms. Jives-Nealy operated Kingdom Dominion Worldwide Ministries, Inc., in Memphis, TN, and received grant funds through the Summer Food Service Program for Children, a U.S. Department of Agriculture program administered by the Tennessee Department of Human Services (DHS). This investigation was completed in conjunction with the Tennessee Bureau of Investigation.

During June and July 2014, Jeanette Jives-Nealy received money for the purpose of providing free meals to children living in economically disadvantaged areas during the summer months. Although Ms. Jives-Nealy claimed she fed thousands of children, investigators determined that all of the money was converted to personal use.

Ms. Jives-Nealy received the grant funds even though they she did not supply any credible documentation to DHS verifying that they were actually acquiring, preparing, and providing food to children. When state auditors asked to review documentation, Ms. Jives-Nealy claimed the records had been destroyed by flooding that had occurred earlier in the day. In October 2014, DHS issued a letter to Kingdom Dominion demanding a full repayment of the grant amount.

On April 26, 2016, Jeannette Jives-Nealy was indicted by the Shelby County Grand Jury on one count of theft over $60,000.

“Whenever a program allows for cash advances, it’s important that program administrators carefully monitor how the money is being used,” Comptroller Justin P. Wilson said. “It is disappointing to learn that such a large sum of public money could be provided without any credible documents to support the feeding of children. The victims in this case include not only taxpayers, but the thousands of children who may have otherwise been fed.”

Note: The full report is HERE. And Sen. Jim Tracy, R-Shelbyville, has sent out a press release declaring the theft would never have taken place if a bill (SB1472) he successfully sponsored this year (along with Rep. Tim Wirgau, R-Buchanan) had been in effect at the time. It’s below.

News release from Sen. Jim Tracy
NASHVILLE — State Senator Jim Tracy, R-Shelbyville, made the following statement after Tennessee Comptroller Justin Wilson released a new special investigative report regarding the theft of $162,165 from federal grant funds administered by the Department of Human Services (DHS) to feed hungry children:

“This theft would have never happened if legislation we passed this year had been in place,” said Senator Tracy. “This is inexcusable, not only because it is stealing funds being used to feed hungry children, but because this is the offender’s second time at defrauding the program.”

“Our legislation makes substantial changes to the way the Tennessee Department of Human Services contracts and monitors third-party agencies that receive taxpayer money to feed children and adults so that this will not happen again. This includes requiring a background check be conducted to stop offenders from setting up shop in a different state after fraud has been committed. It also includes the requirement that a performance bond be posted before funds are received so that we can recoup the money if fraud is found.”

NOTE: Public Chapter 798, which will become effective on July 1, directs DHS to conduct background checks on each applicant of the subrecipient or sponsoring organization. It also requires sponsoring organizations applying to participate in any food program administered through the department to obtain and maintain a performance bond. If the contract is awarded, the department must perform both unannounced and announced physical site visits during the subrecipient monitoring process and report their findings. Similarly, DHS must develop subrecipient monitoring plans under the new law, utilizing analytical procedures that must be submitted to certain legislative leaders and the state comptroller on an annual basis.

In addition, the bill requires the inspector general of DHS must submit a report summarizing the results of any substantiated investigations concerning fraud, waste and abuse regarding the child and adult care food program and summer food service program every three months.