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
By Bill Stalter on Posted in Compliance,Exams/audits,Missouri - SB1Ten years after the collapse of NPS, the Missouri State Board of Embalmers and Funeral Directors has a confidence problem with licensees and legislators. Licensees see a regulator that is obsessed with DBAs, renewal reports, and exams that focus on contract provisions. Legislators see a regulator that will not fulfill the SB1 mandate to protect… Continue Reading
By Bill Stalter on Posted in NPS/LincolnA Texas court has approved the sale of a majority of the NPS preneed business to a Texas insurance company and its subsidiary. As we reported a few weeks ago, Liberty Bankers Life Insurance and Capitol Life Insurance Company will assume the NPS preneed business written in Missouri and Illinois as of November 1st. Funeral homes… Continue Reading
By Bill Stalter on Posted in NPS/LincolnThe Special Deputy Receiver over National Prearranged Services recently filed an application to assign a significant portion of the NPS preneed contracts to Liberty Bankers Life Insurance, and a subsidiary, Capitol Life Insurance Company. If approved by the court, the NPS contracts will transfer on November 1st. Preneed contracts sold in Missouri and Alabama will… Continue Reading
By Bill Stalter on Posted in Missouri - SB1,NPS/LincolnIn an opinion issued last week, the Eighth Circuit Court of Appeals struck down key NPS trial rulings that resulted in a $491 million jury verdict against PNC Bank (as the successor to Allegiant Bank). The appeals opinion states that the trial court erred when it allowed the NPS receiver to argue tort based claims… Continue Reading
By Bill Stalter on Posted in Compliance,Exams/audits,Missouri - SB1,RecordkeepingThe next section of Missouri record keeping proposal addresses funeral homes that handle insurance premium payments. For funeral homes that rely upon insurance funding for their preneed program, the initial payment is typically handled by the funeral director or preneed agent, and then subsequent premium payments are made directly to the insurance company. However, some… Continue Reading
By Bill Stalter on Posted in NPS/LincolnThe Special Deputy Receiver for National Prearranged Services recently filed a Bill of Costs with the Federal trial court. The Bill of Costs seeks to recover copy charges of more than $500,000 from a former NPS trustee. Those costs do not include attorneys’ fees. Litigation can be very costly. Missouri’s preneed regulators are keenly aware of the costs of… Continue Reading
By Bill Stalter on Posted in Associations,Exams/audits,Master Trusts,Missouri - SB1,NPS/Lincoln,RecordkeepingWhen NPS first collapsed, the estimate of the company’s liabilities to funeral homes was reported to have been as much as a billion dollars. When the SDR finally brought the case to trial, the damages awarded by the jury were less than half of the original estimate. While this author believes the actual damages are… Continue Reading
By Bill Stalter on Posted in Compliance,Investments,Missouri - SB1,NPS/LincolnNow that a judgment has been rendered against Allegiant Bank, the NPS litigation will move on to the appeal stage where the focus will be on R.S.Mo. Section 436.031. The NPS trustees universally argued that this provision of the Missouri preneed statute relieved them of all responsibility and liability for investment supervision. As set out… Continue Reading
By Bill Stalter on Posted in Administration,Compliance,Missouri - SB1,NPS/Lincoln,RecordkeepingFinal arguments were heard in the NPS civil trial this past Friday. With the SDR having presented evidence through the prior Friday, the defendant trustees presented their case in less than a week. This may reflect that the NPS trustees had viewed their duties as having been defined by Chapter 436 as relatively low. As… Continue Reading
By Bill Stalter on Posted in Compliance,Fiduciary,Missouri - SB1,NPS/LincolnThe Office of the Comptroller of the Currency (the OCC) supervises the fiduciary activities of national chartered banks, and in February, updated the guidelines used by its examiners. The “Personal Fiduciary Activities” booklet includes a section on pre-acceptance due diligence that fiduciaries should conduct before agreeing to serve as trustee for an account. Page 7… Continue Reading
By Bill Stalter on Posted in Fiduciary,Missouri - SB1,NPS/LincolnThe NPS civil trial has completed its third week, and jurors probably face another four weeks of witness testimony. First from the NPS receiver, and then from the defendant trustees, the jurors are hearing two very contrasting theories of what fiduciary duties were owed by the NPS trustees. Up until a few weeks before the… Continue Reading
By Bill Stalter on Posted in NPS/LincolnThe National Prearranged Services civil trial is scheduled to begin this week, and trial briefs have been filed with the Court. The briefs outline the arguments that each party plans to prove during the course of the trial. It is our understanding that the Special Deputy Receiver has settled with all defendant trustees except Allegiant… Continue Reading
By Bill Stalter on Posted in Administration,Compliance,Investments,NPS/LincolnA recent order issued by the Federal Court trying the NPS civil suit referenced a mirror trust employed by the defendant bank (12-31-14 Order – Comerica MSJ ). To facilitate the trading of investment securities, a brokerage account is established with a firm that can administer the transactions more efficiently than the fiduciary institution. The fiduciary… Continue Reading
By Bill Stalter on Posted in Associations,Investments,Master Trusts,NPS/LincolnIt is common for master preneed trusts to have investments directed by an independent fund manager. The pooling of smaller trusts allows funeral directors to achieve the critical mass needed to engage professional asset management. When investment functions are delegated, the trustee typically wants to be relieved of the supervision and liabilities that accompany those… Continue Reading
By Bill Stalter on Posted in Administration,Compliance,Investments,Master Trusts,NPS/LincolnEarlier this week, the Federal Court that is to try the NPS civil lawsuit next month issued an order (Order denying Morisse JOP Mtn) that will raise red flags for the banks that serve as preneed trustees. In denying the motion of an officer of Allegiant Bank, Judge Richard Webber held that the Special Deputy Receiver… Continue Reading
By Bill Stalter on Posted in NPS/Lincoln,UncategorizedOver a three day span beginning December 17th, a Federal court in St. Louis will hear legal arguments from the NPS special deputy receiver and from banks that served as NPS trustees at some point during the past 30 some years. Initial legal briefs have been filed, and response briefs will be filed. The arguments… Continue Reading
By Bill Stalter on Posted in Compliance,Investments,Master Trusts,NPS/LincolnIn a motion for rulings of law, the NPS Special Deputy Receiver seeks a judicial determination of two legal issues that could impact preneed trustees subject to the jurisdiction of the Eighth Circuit of Federal Court of Appeals: the beneficiary status of preneed purchasers (and funeral homes) and the required independence of investment advisors. These two… Continue Reading
By Bill Stalter on Posted in NPS/Lincoln,UncategorizedDoug doesn’t have much faith in the legion of attorneys retained by the country’s largest banks. Mr. Cassity has filed a writ of habeas corpus ad testificandum that argues only he can effectively cross examine witnesses to NPS’ compliance with the 1994 consent judgment. Mr. Cassity argues that NPS could legally withdraw from trust all funds in… Continue Reading
By Bill Stalter on Posted in UncategorizedIn anticipation of a February trial date, a group from the fiduciary bank defendants has filed a motion for summary judgment in the Federal court that will try the NPS civil lawsuit. The intent of the summary judgment request is to narrow the scope of claims made by the Special Deputy Receiver. The pleadings filed… Continue Reading
By Bill Stalter on Posted in Insurance Funded,NPS/Lincoln,Preneed Tax,Trust Funded,UncategorizedThe NPS civil trial is scheduled for trial in February 2015, and the SDR’s strategy took a twist when her litigation team filed a motion to dismiss Doug Cassity as a defendant in the lawsuit. The dismissal probably signals the SDR’s intent to use Mr. Cassity’s testimony. Now convinced that Mr. Cassity does not have… Continue Reading
By Bill Stalter on Posted in NPS/Lincoln,PreneedNow that Doug and the gang have been processed into the Federal prison system, the Special Deputy Receiver should consider negotiating a deal with the National Geographic Channel about dedicating a season of Lockdown to the NPS preneed gang. Instead of that boring medical facility in Louisville, Doug and Brent have been assigned to two… Continue Reading
By Bill Stalter on Posted in NPS/LincolnThe Cassity shell game may have came to an end this past week when aFederal judge ordered the seizure of NPS computers and 260 bankers boxes of records. Taking a page from a Six Feet Under script, NPS officers sought to conceal their misdeeds by hiding records and computers in crypts located at two of… Continue Reading
By Bill Stalter on Posted in NPS/LincolnI have only scanned Doug Cassity’s plea agreement once, but two issues jumped out from that document. The plea agreement is based on the US Sentencing Guidelines, and Page 28 of agreement explains that the Government and the defendant did not agree as to whether guidelines relating to economic losses should be applicable to Mr.… Continue Reading
By Bill Stalter on Posted in Master Trusts,PreneedThe jury did not buy the Wulf defense, and now the former NPS fund manager faces a much, much longer prison term than Doug Cassity. To get a better understanding of the positions taken by the prosecution and the defense, we will seek briefs and jury instructions. However, the US Attorney’s press release gives some… Continue Reading
