The Special Deputy Receiver for NPS recently reported the company’s “negative net worth” to be just short of one billion dollars. Rightfully, regulators are looking at the NPS fiduciaries for culpability in the losses that will be sustained by consumers and funeral homes in the years to come. In the meantime, Missouri state officials are working
July 2008
A choice
By Bill Stalter on
It is encouraging when funeral directors and consumer advocates engage in meaningful debate about the future of Missouri’s preneed industry. And, there seems to be some consensus that the non-guaranteed contract should have a greater presence in the state.
In the third of six scheduled meetings, industry and consumers were faced with those prickly issues of the trusting…
It was the attorney’s fault
By Bill Stalter on
Here is a twist on the “Another theft from a death care trust”: this one does not involve a cemetery operator or a funeral director. Last week, an Indiana grand jury indicted a banker, an investment advisor and an attorney. What may sound like the beginning of a joke that most funeral directors and cemeterians can relate…
Use it or lose it?
By Bill Stalter on
Posted in Preneed
What happens when the family opts for a cremation at the time of need when the preneed contract provides for a traditional funeral? If the preneed contract was purchased in a spend down situation, the funeral director and the family may be caught in a Catch -22. Many states’ laws preclude the refund of the funds to the family.
Missouri law…
Would consumers purchase a non-guaranteed contract?
By Bill Stalter on
Regulators and preneed sellers squared off recently over the subject of who owns the preneed trust fund: the funeral home or the consumer. Hearings to reform Missouri’s preneed law hit a wall when the issues of trusting requirements, income accrual and portability was taken up by a review committee comprised of regulators, industry representatives and consumers.
In a debate…
Joint Accounts and the Patriot Act
By Bill Stalter on
It was once fairly common for a funeral director to take a preneed purchaser’s funds and establish a joint account at a local bank. Missouri’s preneed law contemplates the transaction and requires that the funeral home and the purchaser have joint control over the account. Prior to 9/11, banks would freely provide account forms, allowing the…
Preneed Portability: easier said than done
By Bill Stalter on
So why is it so tough to provide preneed portability? Because the transaction has been defined by state law as a contract between a consumer and a death care company, and federal regulators tend to agree. When the issue has arisen in the context of federal preemption, the interests of the state regulator have prevailed…
100% Trusting and Restraint of Trade
By Bill Stalter on
Before the guaranteed preneed contract, funeral directors accepted pre-payment on funeral arrangements as an accommodation to their families. Funds were typically placed in a joint account or POD account at the local bank. As this practice became more common, “preneed’ laws were passed to establish requirements regarding the deposit and withdraw of funds. These laws were fairly simple…
Restraint of Trade Issue #1: restricting who can sell or provide preneed
By Bill Stalter on
Posted in Preneed
Although it may not be apparent from the press release or the final Decision And Order, the FTC proceeding against the Missouri State Board of Embalmers and Funeral Directors has restraint of trade implications for future efforts to regulate the preneed transaction.
The focus of the FTC inquiry was on the State Board’s lawsuit…