August 18, 2005
Jefferson City, Mo. — Attorney General Jay Nixon today took a broad range of legal actions across Missouri — including filing criminal charges — to protect consumers who purchased pre-need funeral plans and cemetery headstones. Nixon said the coordinated filings, dubbed Operation Grave Concerns, involve approximately 500 Missourians who paid more than $800,000 for the services.
"Consumers purchase pre-need funeral plans to have the assurance that these arrangements are paid for and taken care of ahead of time," Nixon said. "What we found in our investigations are numerous occasions where the customers' payments were not put in specific trust accounts, as required by law, but instead were diverted for other uses, leaving shortfalls to pay for the funerals when they are needed.
"Pre-need funerals have been a $1.6 billion industry in Missouri over the last 20 years," Nixon said. "Adherence to the laws and regulations governing pre-need funerals is vital to protect consumers. Today's filings serve notice that we will take appropriate action when we believe fraud has occurred."
Nixon filed criminal charges in Dent County Circuit Court against Jane Spencer Turner, who operated Spencer Funeral Homes in Salem and Bunker, for allegedly taking money for pre-need funeral contracts and then using the money for other purposes. Turner (DOB — 11/18/55) faces seven felony counts of unlawful merchandising practices.
Turner sold approximately $157,000 in pre-need funeral contracts as an agent for Missouri Funeral Trust Inc. (MFT) and approximately $88,000 as an agent for National Prearranged Services Inc. (NPS), two of the largest sellers of pre-need funeral contracts in Missouri. Turner allegedly did not forward money from approximately 125 customers to MFT or NPS to place in trust accounts, as required by law. Nixon has filed a civil lawsuit against Turner over an additional 75 pre-need contracts she sold on her own in order to recover $200,000 for consumers.
Nixon filed an assurance of voluntary compliance in Cole County Circuit Court with Missouri Funeral Trust to ensure the integrity of approximately 55 contracts sold through Turner. The settlement requires MFT to provide services for contracts that have been fully paid and to ensure that consumers receive the benefit of the trust which they have partially funded. MFT also will increase its oversight of contracts sold by its agents and pay $20,000 to cover the costs of the Attorney General's investigation.
A separate out-of-court agreement with National Prearranged Services will cover approximately 75 pre-need contracts Turner sold to ensure adequate funds to pay for funerals. NPS also will more closely monitor pre-need funeral contracts and has made a $10,000 payment to the Missouri Merchandising Practices Revolving Fund.
A Vandalia funeral home operator, Donald E. Holt, faces nine felony counts of unlawful merchandising practices in Audrain County for allegedly failing to deposit pre-need funeral funds in an escrow account, and then using the money for other purposes. Holt (DOB - 1/13/60) operates Holt Funeral Home.
Nixon is suing Eddie Swarnes, of Swarnes Funeral Home in St. Louis, for alleged taking money for pre-need funeral plans from consumers and not forwarding the funds to trust companies. In one case, a customer had purchased a pre-paid funeral plan, but upon the customer's death, the family discovered no trust account existed — costing the family $8,000 for the cost of the funeral.
Larry Keith Lawhon (DOB - 10/8/51), of Independence, faces 10 felony counts of unlawful merchandising practices filed in Clay County Circuit Court. Lawhon allegedly took several thousand dollars from consumers who purchased cemetery headstones from his Smithville business, LL Monument Co., but then did not deliver the headstones or provide refunds.
Nixon obtained a consent preliminary injunction in Scott County Circuit Court against Mike Graham and Associates. The company does business as Memorial Park Cemetery and Garden of Memories in Sikeston, Forest Hill Memorial Gardens in Morley, and Ozark Memorial Cemetery in Rolla. The company allegedly took money for dozens of grave markers that were never delivered, and sold space in a mausoleum in Rolla that has yet to be constructed.
Under the injunction, Mike Graham and Associates agreed to cease the sale of cemetery headstones, plots, vaults and other goods and services where prepayment is required. Nixon is seeking a permanent injunction to require the defendant to provide restitution or services worth approximately $260,000 to more than 100 consumers.
Nixon is suing Heartland Monument Company, of Springfield, in Greene County Circuit Court. The lawsuit alleges Heartland collected funds from families for the purchase of headstones, then failed to deliver the monuments as promised.
Nixon filed a lawsuit against Jeffrey W. Thomure, of Manchester, who does business as Standard Monument Co. The business is located at 7225 St. Charles Rock Road. After receiving prepayment for cemetery monuments, Thomure allegedly failed to deliver the markers and refused or failed to respond to consumers' inquiries.
"The loss of a loved one is a time when we are the most vulnerable, and are most in need of someone we can trust," Nixon said, concerning the legal actions his office is taking on cemetery headstones. "These operators took advantage of grieving families in their time of loss. It is something we cannot and will not let go unchecked."
Unlawful merchandising practices, the charge in the three criminal cases, is a class D felony, punishable upon conviction by up to four years in prison and a $5,000 fine on each count. In the three criminal cases, the charges against the defendants are merely accusations. As in all criminal cases, the defendants are innocent unless or until proven guilty in a court of law.