'Robbing the Grave' Pre-need funeral contract fraud and mismanagement has been on state's radar for 10 years
NORTHAMPTON — The challenge of making sure consumers get what they paid for in pre-need funeral contracts is not limited to the now-defunct Ryder Funeral Home. Nor is it a new concern.
A former Boston funeral home director, Joseph V. O’Donnell, 55, was being held last week on larceny charges for allegedly taking more than $12,000 in pre-payment funds from an elderly couple to cover two future funerals at his now-closed funeral home in Dorchester.
In a related development, an ongoing investigation into O’Donnell’s former business by the Suffolk district attorney’s office led Thursday to the discovery of the remains of a dozen human bodies in a storage unit in Weymouth and cremated remains in a storage unit in Somerville.
O’Donnell’s license had lapsed in 2008 and police and prosecutors also are investigating the validity of funeral arrangements for which O’Donnell took money.
A decade ago, state lawmakers were analyzing these same issues in the wake of incidents of funeral home fraud and mismanagement of pre-need contract funds.
In a 2003 policy brief titled “Robbing the Grave” by the state Senate Committee on Post Audit and Oversight, lawmakers examined the state’s consumer protections regarding pre-need funeral contract fraud and loss. It found that while Massachusetts law and regulations governed pre-need contracts, they did not offer enough protection to adequately protect those investments.
The review by the Senate’s investigative arm cited at least eight separate documented cases in which Massachusetts consumers were deprived of funds due to fraud or other actions by funeral home officials. The review offered several recommendations on ways to strengthen oversight.
It identified regulation loopholes and reporting glitches, including not having the names of each consumer investing in pre-need services listed on the pre-need reports that funeral homes are supposed to file each year with the state. Adding the names would allow the state Board of Funeral Directors and Embalmers to contact consumers in cases of fraud or abuse, lawmakers recommended at the time.
“When cases of fraud occur, the board is often only aware of the problem if consumers come forward to complain about lost funds,” the Senate’s investigative committee found. “It is possible there may be victims of pre-need fraud and abuse who have lost money but are too grief stricken to notify the board of their loss, or may not yet be aware that their money has been lost or misused.”
The committee found that at least nine other states at the time provided mechanisms to protect the money consumers invest in pre-need contracts and recommended Massachusetts do the same so that people like the Rys family of South Hadley have more protections when questions arise and their money can’t be found. No such mechanisms exist in the commonwealth’s funeral industry and little reform resulted from the study.
Pamela Rys, of Ludlow, is still trying to locate nearly $17,000 her family invested in March with the now-closed Ryder Funeral Home for her parents’ future funerals.
“My money is nowhere,” Rys said. “It’s not there.”
Peter Stefan, a Worcester funeral director and member of the state Board of Registration of Funeral Directors and Embalmers, is pushing the state panel to strengthen consumer protections regarding the handling of pre-need funeral service money.
“Something is needed to bring an end to this,” said Stefan of alleged mismanagement of pre-arranged funeral money.
In the absence of a state fund to reimburse consumers who may have lost money in the more recent O’Donnell and Ryder cases, Stefan suggested funeral directors in the commonwealth pitch in and provide some financial relief to families.
“When they (investigators) find out what’s lost, I’ll put up the first $1,000,” he said.
Dan Crowley can be reached at firstname.lastname@example.org.