Many Missouri preneed sellers have become dependent upon their trustee for the individual contract accounting required by law changes implemented in 2009. Some of those same funeral homes also have consumers make their preneed contract payments directly to the trustee. As a consequence, the seller does not handle consumer funds, and is unable to document preneed contract payments. The next section of the Missouri seller record keeping proposal is directed at that situation:
- For trust and joint account funded preneed contracts:
(4) If funds for a preneed contract are paid by the consumer directly to the financial institution, the seller shall maintain, or be able to access, records from the financial institution showing the dates and amounts of each deposit and the name of the preneed contract beneficiary for each deposit made; and
This record keeping requirement could prove problematic for Missouri’s preneed sellers in a couple of different ways.
To the extent that banks and trust companies provide on line access to trust clients, transaction records are typically archived after a couple of years. After transactions have been archived, the preneed seller can no longer access the records via the internet portal. Consequently, the staff’s proposals would require preneed sellers to down load transaction records on a regular basis.
Banks and trust companies use a variety of different trust accounting platforms, and some of those platforms offer limited options for reporting transactions. To minimize account inputting, trustees may aggregate consumer payments prior to inputting deposits to their accounting system. Consequently, the trustee may not have a record that shows the date and amount of each consumer deposit. The best record the bank may be able to provide would be a monthly or annual summary of trust deposits.
Another problem with this section is that individual consumer accounts are typically set up in the purchaser’s name. Payments are matched up to the purchaser (who has written the check to the bank).