Your Funeral Guy in Dow Jones Newswires

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Your Funeral Guy has been Featured in the Dow Jones NEWSWIRE  Prepaid Funerals Like Digging Your Own Grave  December 2, 2010 9:16 a.m. EST By AL LEWIS A DOW JONES NEWSWIRES COLUMN R. Brian Burkhardt is a funeral director in Illinois and Virginia who writes a blog called “Your Funeral Guy.” It’s filled with handy consumer tips, as is his book, “Rest in Peace, Insider’s Look at the Low Cost Less Stress Funeral.” Burkhardt also covers the funeral news: “Mom fakes daughter’s funeral.” “Father sues after son’s body falls out of casket.” “Corpses to appear on cigarette packages.” And, “Unclaimed cremated remains: A growing problem.” One of the biggest stories on the funeral beat these days involves a St. Louis, Mo., company called National Prearranged Services Inc. and its related businesses operating in several states from Illinois and Ohio to Tennessee and Texas. Federal prosecutors last week unveiled a 50-count indictment burying six controlling officials in assorted criminal charges: money laundering, conspiracy and wire, bank, mail and insurance fraud. Defendants are Doug Cassity, 64; his son, Brent Douglas Cassity, 43; Howard Wittner, 73; Randall Sutton, 65; Sharon Nekol Province, 66; and David Wulf, 58. The indictment alleges they took as much as $600 million that should have gone into trusts and life-insurance policies to cover as many as 150,000 funerals. “White-out was the main tool,” Burkhardt said. “It’s sounds blastedly simple, but that’s what they did.” Indeed, one of the many tricks alleged in the federal indictment is altering documents with correction fluid. Money that should have gone into trusts or to pay life-insurance premiums for the funeral plans were diverted to pay for business investments, luxury homes and jewelry, the Feds allege. A Ponzi scheme for the dead? Toni Weirauch, special agent in charge of IRS-criminal investigations in St. Louis, said his office “is committed to investigating individuals who allegedly use their businesses as personal piggy banks.” The losses will go to state insurance guarantee associations, plan purchasers and funeral homes. Connie James of James and Gahr Mortuaries in St. James, Mo., said her family-owned funeral business put all of its prepaid funeral funds with the company. A state fund likely will get stuck with most of the tab for the prepaid services her company has contracted to provide, but not all of it. Some of the losses will be hers. “You just pray every day that you’re going to be here tomorrow,” James said. She has a name for defendant Doug Cassity, who went to federal prison in the early 1980s for charges stemming from his investment club. “He is the Bernie Madoff of Missouri,” she said. She wonders how so blatant an alleged fraud could have gone on for so long in an industry that is supposed to be regulated. Cassity’s criminal past, and issues with underfunded trusts dating back to the 1990s, didn’t set off the alarms until the shortfall was enormous. “$600 million. That’s a lot of damn funerals,” James said. National Prearranged Services sold folks on the idea that they could pay today’s prices for tomorrow’s funeral services. Say you put $5,000 down now, and if the funeral you want costs $15,000 due to future inflation, no problem. “Any product that says, ‘We will cover you no matter how much your prices increase’ is too good to be true,” said Scott Gilligan, general counsel of the National Funeral Directors Association in Brookfield, Wisc. “That should have been everybody’s first clue,” he said, “because nobody can do that.” Burkhardt said he’s been warning consumers not to buy prepaid funeral plans for years. “It’s better to a get term life insurance policy and apply that money to the funeral,” he said. He also says the scale of the National Prearranged Services case shows how easily prepaid funeral funds are diverted, and how long it can take regulators to do something about it. “Every week, somebody misappropriates pre-need funds, and every two to three weeks somebody gets caught,” Burkhardt said. “I have had a funeral director tell me, “When I can’t meet my payroll, I just borrow from the pre-need fund.” That’s fraud. But in their minds, it’s kind of their money.” Burkhardt said he suspects business will go on as usual, despite the news he covers on his blog. Reading up on prearranged funeral plans isn’t something folks always do before they buy. “People don’t want to talk about death,” he said. “You almost have to trick your mind to think about it. That’s why people buy these plans.” –(Al’s Emporium, written by Dow Jones Newswires columnist Al Lewis, offers commentary and analysis on a wide range of business subjects through an unconventional perspective. The column is published each Tuesday and Thursday at 9 a.m. ET. He can be reached at 212-416-2617 or by email at al.lewis@dowjones.com, or on his blog at tellittoal.com.) (We invite readers to send us comments on this or other financial news topics. Please comment on Al Lewis’ blog at http://tellittoal.newswires-americas.com/. We reserve the right to edit and publish your comments along with your name; we reserve the right not to publish reader comments.) URL for this article: http://www.djnewsplus.com/article/0,,SB129129867914576950,00.html Related articles National Prearranged Services Executives Indicted-Your Funeral Guy (yourfuneralguy.wordpress.com) Recycled Pacemakers-To be done by USA Funeral Homes-Your Funeral Guy (yourfuneralguy.wordpress.com) Funeral Industry| Funeral News| Funeral blog by Your Funeral Guy Due to my stint in ICU and hospitalization it took some time to get this article up. YOUR FUNERAL GUY HAS BEEN Featured in the Dow Jones News Wires. Your Funeral Guy is quoted but other opinions are mentioned.

ARTICLE FROM  AL’S EMPORIUM

Your Funeral Guy is for Create a Great Funeral Day-Oct 30th|YourFuneralGuy

Plan Your Funeral  You Can  even Have Your  cremation ashes shot into outer space  Image via Wikipedia

Create a Great Funeral Day is October 30th 2010. Create a Great Funeral Day has been around a couple of years. It is very important to plan your funeral but not to prepay.

A Funeral planner is a great asset in planning  a Funeral. If you live in the UK You should consider using A Good Funeral Guide by Charles Cowling.

For  the USA, Another  great resource is Death For Beginners by Karen Jones. Rest in Peace Insiders tips to the Low Cost Less Stress Funeral will also help.

There is a New Book coming out that i  have read and recommend A Good Goodbye:Funeral Planning for Those Who Don’t Plan to Die

Funeral Industry|Funeral News | Funeral Blog By Your Funeral Guy

Related articles

• 48 Articles About Pre-planning and Avoiding Surprises with Your Loved One’s Final Costs (termlifeinsurance.org)

NPS “Preneed” Court-YourFuneralGuy

National Prearranged Services(NPS) is back  in court over  Funeral Fraud  in the amount 600 million dollars. At issue is a court injunction and the owners spending the funds they received from the Fraudulent Preneed Contracts.

State insurance Guaranty associations who have guaranteed the the  funeral funds to the consumers have brought the lawsuit against the  owners.

At issue is whether spending of funds that can be recovered will be curtailed.

National Prearranged Services back in Court

The topic in the federal courtroom on Wednesday was money, specifically what happened to $600 million and whether a federal judge should be watchful to make sure even more money doesn’t go missing.

“No one disputes that the money is gone,” attorney Daniel Reilly told the federal judge. “But the defendants never say where that money went.”

The defendants in this case were the Cassity family, owners of a once-celebrated funeral services company in Clayton and a web of affiliated companies. They ran National Prearranged Services and Forever Enterprises, plus two life insurance companies.

via www.stltoday.com

Do not put your funeral cost funds at risk do not do Funeral Preneed,

Some estimates put total losses at 1 billion not 600 million.

Funeral Industry|Funeral News| Funeral Blog by Your Funeral Guy

California Funeral Directors Association Scandal similar to Illinois-YourFuneralGuy

The similarity between the California Funeral Directors Association and the Illinois Funeral Directors Association seem to Go on on and on.

In California and Illinois the value of the trust Fund was inflated so that those holding the trust could take/make more money out of the fund.

In each case the Funeral Directors Association in Illinois and California misappropiated the folks funeral Funds for lobbying, conventions and other projects.

In each case the lawyers on both sides disagree as to the facts.

The audit also found the trust failed to pay at least $1.6 million it owed to consumers, their estates or the state treasury in cases where funeral homes went out of business or families paid for funeral services because they didn’t know their loved one had a prepaid plan.

The audit found that $4.2 million was improperly spent on administrative fees for the participating funeral establishments over eight years. The trust improperly inflated its income in 2001 and 2002 so it could pay $4.8 million in administration fees to the fund’s trustee, Comerica Bank, and Funeral Directors Service Corp., which administered the fund, the audit found.

The department also has ordered the funeral homes and trust administrators to make up for lost investment income from money that was siphoned away from the trust.

In a joint letter, attorneys for the fund trustee and fund administrator disputed many of the report’s findings. They called them “factually and legally inaccurate.”

The attorneys said the trust always intended to follow state law and regulations.

via www.sfgate.com

Funeral Industry|Funeral News| Funeral Blog by Your Funeral Guy

Your Funeral Guy Exclusive|California Funeral Directors Association Scandal

Your Funeral Guy First reported on the California Funeral Directors Association(CFDA) on January 7th, 2010. Click Here for the report.

Now that the scandal has received local coverage in California we can report on this matter more fully because my research has been verified by a State Audit. The scandal is quite similar to the Illinois Funeral Directors Association Scandal. Right now the dollar amount is less than The IFDA Preneed Trust Scandal. That could change.

Early audits in the IFDA Preneed trust scandal did not reveal the extent of the problem. Later on Gross Misappropriation of the Folks Money was discovered. The current situation involves the California Master Trust.

Now that there is  a second maor Funeral directors association scandal the national media may take note.

Do Not Hold your Breath.

The audit was the first to find systematic problems with a funeral trust fund(California), Wallinder said. Typically, auditors find problems involving individual funeral homes or trusts set up for individual consumers, he said.

In this case, the department ordered the trust’s governing board to return more than $2 million that was spent on lobbying and conventions for the California Funeral Directors Association. Some of the money already has been paid back, auditors said.

The audit also found the trust failed to pay at least $1.6 million it owed to consumers, their estates or the state treasury in cases where funeral homes went out of business or families paid for funeral services because they didn’t know their loved one had a prepaid plan.

via www.mercurynews.com

Funeral industry|Funeral News|Funeral Blog by Your Funeral Guy

Funeral homes selling Preneed As a Good Investment|are lying|Your Funeral Guy

Funeral Homes selling Preened as an investment are lying.  To prepay a funeral today, “LOCKING IN TODAY’S PRICES FOR YOUR FUNERAL TOMORROW” is a lie. The current economic environment in the world makes that statement a falsehood.  No Investment vehicle can be guaranteed that since the Wall Street Crash of September 2008.

Firstly, Prepaid funerals or(preneed) has always been  a purchase of funeral goods and services.In the past and many times the funds are placed by the funeral home, funeral director or insurance company in a special bank account.

Depending on the pre need Contract and state regulations the funds used to purchase sometimes can be placed in an investment vehicle. The Track record of indivudual funeral homes and others doing this though is not good.

When this has happened there are examples of bad outcomes—the local funeral home in the news, funeral associations(example- IFDA Illinois Funeral Directors Association preneed trust ponzi scheme) and funeral insurance companies(-Example-NPS-National Prearranged Services)

Funeral industry|Funeral News Funeral Blog by Your Funeral Guy

WSJ:Preneed, Prepaid Funeral Regulation Ahead|YourFuneralGuy

Preneed or Prepaid Funerals go by many names such as  End of life insurance, funeral insurance, preneed, prepaid funerals etc. The National Prearranged Services(NPS) Funeral Scam, the IFDA(Illinois Funreral Directors Association) Preneed Trust Funeral Scam, and Weekly incidents of funeral directors running off   with the folks funeral money has all contributed to this development

Snippet From the WSJ.

It’s among the best-intentioned and—in the eyes of some—worst investments that people make: paying in advance for a funeral.

Now, in the wake of recent allegations of fraud and mismanagement in this multibillion-dollar industry, state and federal lawmakers are trying to crack down on abuses in so-called prepaid funeral plans.

“Consumer advocates have been urging states to enact stricter regulations of prepaid plans for years,” says Sally Hurme, a senior project manager who specializes in consumer education at AARP, the Washington-based advocacy group. “This is a step in the right direction.”

via online.wsj.com

This should shoot an arrow in the heart of those who have  have participated in  preneed irregularities, fraud and scams

Funeral industry|Funeral News|Funeral blog by Your Funeral Guy

Years? until we find out where Illinois Funeral scam Money went|Your Funeral Guy

IFDA WHERE DID THE MONEY GO?The crimes committed by the Illinois Funeral Directors Association should not go unpunished.

There are many ongoing investigations in the Illinois Funeral Directors Association(IFDA) preneed scandal. Lawsuits are hung up in  the courts. It is being reported that reform legislation is held up in the Illinois legislature.

In the meantime, there is no telling how long consumers will have to wait while the matter still is under investigation. It could be months or years before the Graces and thousands of Illinois residents who prepaid for funerals know where millions of missing trust fund dollars went.

via dailyme.com

How can funeral directors steal Millions and it take years for the matter to be resolved? Why does it take drawn out investigations  to resolve pre need scandal.( It took decades to find out where the National Prearranged  Services dollars went) As these things drag on  funeral directors  continue steal out of trust funds, and take  unauthorized loans  as Illinois Funeral Directors Association Board Members did.

Time will go on and more Preneed Insurance Scandals will occur. Major players will move on and assume positions of leadership-often times with no resolution of misdeeds.(Look at Randall L Earl a major player in the IFDA Ponzi Scheme who may very soon be president of The National Funeral Directors Association, NFDA).

Funeral Industry|Funeral News| Funeral Blog by Your Funeral Guy.

The lesson here is clearly to avoid prepaying for a funeral.

pic IFDA logo e-mailed to yourfuneralguy by the Illinois Funeral Directors Association.

New Research on Illinois Funeral Scam|Your Funeral Guy

There is new Research available on the Illinois Funeral Director’s Association (IFDA)Preneed Funeral Trust Scandal. Here is a guest post by free lance journalist-Heather Stanke

The Illinois Funeral Directors Association is currently involved in class action lawsuits regarding the mismanagement of a pre-need trust fund, which resulted in the loss of $59 million of trustee funds. As a result of the mismanagement, funeral directors have had to cover the losses and still perform all guaranteed funeral services for their clients.  Each time funds are misused, the costs of funerals are raised.  The situation has caused an integrity problem for the funeral home industry.

The fund was set up in 1980, by then comptroller Roland Burris, the current junior Senator of Illinois. He illegally issued a license for the fund, and later lobbied for it. IFDA members deposited money into the fund from pre-need sales and it was invested by the trustees. Burris has been subpoenaed in a current lawsuit the IFDA is facing, asking him to come forth with any documents relating to the fund and figures of how much he was paid to lobby state regulators.  In 2009, the IFDA reported 49,000 policies with $300 million in assets, according to the IFDA.

Much of that money, over $190 according to the lawsuit, was invested irresponsibly in life insurance policies, under the recommendation of Ed Schainker, an investment advisor for Merrill Lynch.

Shainker’s powers to advise and sell insurance were suspended by Secretary of State Jesse White on February 25, 2009.  The order of suspension says that while he was acting as advisor, Shainker sold over 300 insurance contracts to the IFDA.  One hundred and twenty of those contracts were from Merril Lynch, for which he earned millions of dollars in commissions.  The insurance policies were taken out on the lives of IFDA board members, directors and officers.  They have been losing the fund money because those people aren’t dying fast enough.  Shainker didn’t analyze the purchases beforehand to predict this occurrence.

In 2007, an independent audit reported the fund at a deficit of $39 million, a direct result of the insurance policies not being paid out.  The IFDA’s license to act as trustee of the fund was revoked by comptroller Dan Hynes.  In 2008, Merril Lynch took over as trustee of the fund, after Regions Bank declined the offer.

In October 2008, the IFDA website told consumers in a Q&A section, that they should feel perfectly confident in buying pre-need funerals.  Some homes continue to recommend pre-need services to clients. Darcy Kolschefski is a pre-need funeral counselor at Hultgren Funeral Home in Wheaton, IL.  He said that only 30 of his 4,000 pre-need cases use the trust anyway, and that no matter what, the consumer receives their services.  He said that funeral homes across the state have signed a pact agreeing to try to recoup losses incurred by the trust.

Hultgren uses a re-insurance pool akin to the IFDA for their policies, and still recommends pre-need because it keeps the home from having to finance the funeral while the family waits to gather funds to pay it.

In November(2008), two women who had purchased pre-need funeral contracts filed suit against the IFDA, and on January 28, 2009, a second lawsuit was filed.  The second was by six funeral directors affected by the losses.  The case is likened to a Ponzi scheme, in which returns are paid to investors from their own money or other investors’ money, not from profits earned

Heather Stanke, Freelance Journalist (her blog is called NIPIZHO)

Embezzling $257,119 Preneed Funds|Your Funeral Guy

A couple in Michigan Embezzled(misappropriated)  $257,000 in Preneed Funds from the families they served at a funeral home. Just as the leaders in the Illinois Iuneral Directors Association Ponzi Scheme have not been brought to justice, these two appear to be getting off with restitution and probation.

When funeral providers take people’s preneed funeral funds there should be punishment. Otherwise Funeral Directors will continue to take peoples funeral money.

There are the big cases like that of National Prearranged Services.(NPS) or the Illinois Funeral Directors Association. Every week  in the press there are local  funeral providers who misappropriate or steal money-many times out of  preneed or prepaid funerals. This is one reason for mistrust of funeral directors.

A Canton couple pleaded no contest Friday to embezzling money from prepaid funeral customers and has agreed to pay back 23 victims.

Christopher and Nancy Ziomek, who operated the now-closed Ziomek Funeral Home on Wayne Road in Livonia, entered the pleas in Wayne County Circuit Court to one count of embezzlement of $50,000 or more, but less than $100,000. The offense is punishable by up to 15 years in prison.

via www.freep.com

Funeral Industry|Funeral News|Funeral Blog by Your Funeral Guy