Death Care Compliance Law

Death Care Compliance Law

Preneed: A Pandora's Box of Problems

William Stalter is the founder of Stalter Legal Services and the Preneed Resource Company. Bill focuses his law practice on preneed and death care compliance, serving banks, funeral homes, crematories, and cemeteries. He has written multiple published articles

Category Archives: IFDA

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Consumers: Reading the Bold Print

Posted in IFDA, Preneed, Preplanning
A recent news report titled “Broken Trust” served to fan the emotions of Illinois residents who purchased a preneed contract from the Illinois Funeral Directors Association. The facts involve a 103 year old lady who purchased the contract 16 years ago, and experienced a 32% drop in the contract’s value in one year. The news… Continue Reading

Illinois Preneed Fund Migration: SB1682

Posted in IFDA, Preneed
With the upcoming new year, Illinois smaller funeral homes will begin searching for a corporate trustee for their preneed funds.  With the Legislature’s approval of the Governor’s Amendatory Veto of SB1682, funeral directors lose the authority to serve as fiduciary of their own preneed funds.   … Continue Reading

Third time’s the Charm: Preneed Legislation

Posted in Cemeteries, Funeral, IFDA, Legislation, Missouri - SB1, Preneed, Reform
The old axiom was that it would take three consecutive legislative sessions to get a preneed bill passed. If Missouri and Illinois are indicators of the current preneed reform movement, the charm may be based not on attempts but actual bills passed by the legislature. The Illinois Comptroller’s proposal for preneed reform, SB1682, is progressing… Continue Reading

Illinois’ death care reform: inching towards reality

Posted in IFDA, Legislation, Preneed
Reform in Illinois inched closer to reality with Governor Quinn’s "amendatory veto" of SB1682.  If accepted by the Illinois legislature, the reform bill will become law on January 31, 2010. However, the Governor is seeking a 30 day window between the deadline for the report due from the Funeral Burial Task Force and SB1682’s effective date.  It is doubtful much could be done to change SB1682 during… Continue Reading

But, we had a deal….

Posted in Fiduciary, IFDA
Rather than defend the legality of its master trust, the IFDA sought to enforce the gentlemen’s agreement that the association perceived it had with the Comptroller. The 2006 exchange of correspondence reported by the State Journal-Register underscores the risks that death care operators take when they structure arrangements that exceed the parameters of applicable law.… Continue Reading

The Illinois Comptroller’s Doubletalk: Who’s the Seller?

Posted in IFDA
Last week’s exchange between the State Journal-Register and the Illinois Comptroller’s office underscores just how poorly some regulators (and funeral directors) understand the preneed transaction. The newspaper’s June 24th editorial included the following statement: The directors allege they didn’t find out about the audit until fall 2007 when the comptroller revoked the IFDA’s license to… Continue Reading

Insurable interest and the IFDA master trust

Posted in IFDA
The Illinois Division of Insurance made the right call: the IFDA master trust does not have an insurable interest in the lives of the members who participate in the trust. A preneed trust is intended to fund the liability that arises when the preneed beneficiary dies and a funeral must be provided. Accordingly, it is… Continue Reading

The Comptroller’s bill: raising the bar for foreign fiduciaries

Posted in Fiduciary, IFDA, Preneed
Finding a fiduciary institution that is both knowledgeable and receptive has proven a challenge to funeral directors. Until a few years ago, the larger operators could rely upon the size of their trust to at least generate interest from prospective institutions. However, litigation exposures are now causing institutions to hesitate with even the largest of… Continue Reading

The IFDA’s Defined Benefit Plan

Posted in IFDA
It may be a mere coincidence, but the $9.7 million demand made by Comptroller Dan Hynes upon the IFDA is approximately 25% of the $39 million dollar “deficit” that the master trust had accrued by 2006. In applying the letter of the law, the Comptroller has rejected the IFDA approach of crediting individual preneed accounts… Continue Reading

A shotgun wedding: The Comptroller’s elimination of the self-trusted arrangement

Posted in IFDA, Legislation, Preneed, Reform
The battle to reform Illinois’ preneed funeral law was renewed by the Comptroller’s office with the release of his Amendment to Senate Bill 1862. Reform in Illinois will take months, and the final product may differ substantially from the Comptroller’s proposal. However, SB 1862 flags Mr. Hynes’ priorities, and one of those priorities could force… Continue Reading

Preneed Task Forces

Posted in IFDA, Legislation, Preneed, Reform
Like the Swine Flu, a preneed virus has been spreading across the Midwest.   Looking for a cure, state legislators and regulators have been forming research teams.  It all started last summer, with Missouri’s Chapter 436 (funeral) working group and Chapter 214 (cemetery) working group.  Now, Illinois is establishing a preneed task force, and Kansas is… Continue Reading

They can’t legislate morality, but they can impose due diligence requirements

Posted in Fiduciary, IFDA, Legislation, Preneed, Reform
Missouri’s preneed reform legislation will be amended on the House floor in the next day or so, and some of the Representatives have heard that old phrase about legislating morality. There is some truth to that phrase, and to some of the other objections raised against the reform legislation. Preneed oversight will impose a substantial… Continue Reading

But the Senator’s answers are relevant

Posted in IFDA, Preneed
U.S. Senator Roland Burris has been sidestepping questions about his role(s) in the IFDA master trust troubles.  While the Senator was a side issue to a March 30th article published by the Springfield Journal Register, the statement provided by his public-relations specialist may signal just how little Mr. Burris understood about his responsibilities to the… Continue Reading

Chris Butler’s attempt to set the record straight

Posted in IFDA, Preneed
The IFDA seems to be everyone’s favorite whipping boy. Even prominent industry leaders are stepping back from the Association in its time of need. The epicenter for the latest news on the IFDA’s troubles has been the Springfield Journal-Register and Bruce Rushton. Mr. Rushton has done a thorough and excellent job of reporting on the… Continue Reading

Now that we have your attention: IFDA liability exposure

Posted in Fiduciary, IFDA
In naming the IFDA officers and board of directors as individual defendants in their lawsuit, the Calvert group sought to make these individuals accountable for management of the association’s master trust.  Members of a board of directors have a duty to act in the best interests of the organization.  Defenses against personal liability are afforded… Continue Reading

It’s not my job, man.

Posted in IFDA, Legislation, NPS/Lincoln, Preneed, Reform
Illinois and Missouri have more in common than they may realize. Consumers and funeral directors are blaming state regulators for their current preneed problems. Looking to avoid that hot seat, regulators have been stating their excuses/defenses. If legislators are to correct the flaws in their state’s preneed oversight, they need to put partisan politics aside… Continue Reading

Restoring peace of mind: at the preneed provider’s expense.

Posted in Fiduciary, IFDA, NPS/Lincoln, Preneed, Reform
John Duggan has a point, and that’s what concerns regulators in Illinois, Missouri and Texas. Who will be blamed when the consumer does not get the benefit of their preneed contract? While the overwhelming majority of NPS’ preneed contracts will be honored by the funeral home named in the contract as the “provider”, it is… Continue Reading