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OCTOBER 2014
FUNERAL HOME & CEMETERY NEWS
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Gary Finch is a licensed funeral director and embalmer in Texas.
He founded Compliance Plus in 1992. Today, they represent over
700 funeral homes and cemeteries in 37 states. Compliance Plus
also serves as an advisory consultant for the International Order of
information on Compliance Plus visit
ontact Gary by phone at (800) 950-
1101 or by e-mail at gfinch@kisscompliance.net.
By Gary Finch
OSHA
Compliance
Death Care OSHA Inspections
Down for 2014
There have not been many death care indus-
try inspections. What few inspections there
are, are concentrated among just a few states.
I cannot give you a good reason for this other
than North Carolina and Virginia have a his-
tory of being far more active than others states.
Here is the rundown for the 23 inspections
through August of 2014:
North Carolina 5 inspections
Virginia
9 inspections
Washington
2 inspections
Michigan
1 inspection
California
1 inspection
Puerto Rico
1 inspection
South Carolina 2 inspections
Oregon
1 inspection
Eight inspections were initiated by employee
complaints. We do not know if they were from
a single employee or from multiple employees.
Eight were planned inspections. All eight of
the planned inspections took place in states
that run their own OSHA program. A ninth
planned inspection was cancelled. This is prob-
ably due to the facility having less than eleven
employees or having some type of exemption.
Two were follow-up inspections. This means
the facility received an earlier inspection.
OSHA revisited the facility to see if promised
improvements were actually done.
Five listed inspections did not happen. They
were classified as un-programmed related.
This could indicate a firm was exempt. It
could also indicate the firm had already been
inspected. We know that was the case in one
North Carolina facility as they had fines of
$3,600.
Other significant fines were given to a Puer-
to Rico facility for $6,500. The biggest dam-
age so far this year went to a funeral home
and memorial park in San Mateo, California.
They did a remarkable comeback from their
initial fine of $26,400 to obtain a settlement
of $7,995. I am certain they had competent
representation to come up with that kind of
settlement. Good for them.
We still have over three months left. I think
it will remain quiet until we get a wave of
GHS Hazard Communications inspections
in 2015 and 2016. That’s just my best guess.
Today, few things are certain, particularly when it
comes to finances. Given the current economic cli-
mate, it’s more important than ever for funeral service
professionals to monitor and understand the nature of
their assets, changes within our industry, and develop
a renewed appreciation for this level of clarity.
Recently, the funeral trust industry has seen its share
of incidences such as the shocking $21-million short-
fall from what was supposed to be the
Wisconsin Fu-
neral Directors Association’s
$69-million master trust.
More than 10,500 unsuspecting consumers and fu-
neral homes thought trust assets were secure, but in
reality, funds were placed in speculative investments.
How could this happen? As is often the case, it was
not a single incident, but a series of events that lead to
this failure. In 1999, the WFDA began marketing a
Master Trusts Must be Transparent
By Bill Williams
Bill Williams
prepaid plan meant to assist firms with providing a safe
haven for their consumers’ prepaid funeral funds. But
as it turns out, the money was deposited into a trust
that had deviated from prudent investment standards.
Firms offering this plan had little or no informa-
tion about what was being done with their clients’
funds. Trust administrators never revealed to associa-
tion members or consumers that there was a signif-
icant shortfall and that funds deposited by one pr-
eneed contract were being used to pay for another
preneed contract at the time of fulfillment. Basically,
the trust was “robbing Peter to pay Paul” and poor
management left funeral firms holding the bag. Still,
firms are fulfilling these preneed contracts while be-
ing paid only a fraction
of the funds originally
deposited into trust, with
little hope of being reim-
bursed in the future.
While the situation in
Wisconsin doesn’t paint
a picture of the entire pr-
eneed trust industry, it
does provide a case study
of what could have been
prevented with proper
transparency and “truth
in reporting.”
The trust itself should
be completely transpar-
ent to the funeral firm.
Each month, professional trustees should reconcile
the trust; distribute the market value of all earnings
and expenses to each participating firm, then to each
of that firm’s preneed contracts. Each firm should re-
ceive a monthly trust statement based on the actual
market value of their preneed contracts. The key is
“actual market value” – what you can expect to re-
ceive when the preneed contract is fulfilled. If the
actual market value is less than the original amount
deposited or the increase is nominal, you may have
a problem. However, you’ll never know without re-
viewing the monthly trust statement.
Clarity about a trust’s funds and activity is one of
many factors to consider when developing, reviewing
or participating in a master trust program. To help en-
sure the transparency and security of funds, trust pro-
fessionals should be hired to manage the trust and em-
ploy accounting best practices, fiscal due diligence and
transactional checks and balances to ensure accurate fi-
nancial reporting. They should serve in this role with-
out the burden of outside influences. Trustees should
be state or nationally charted financial institutions with
in-depth knowledge of fiduciary responsibilities, and
be held accountable by federal and state regulations.
With these parameters, funeral service professionals
achieve a more accurate understanding of their funds,
grow wise to shifts in the marketplace and regulatory
landscape, and may better plan for their financial fu-
ture. Unfortunately, those who lacked clarity about
the nature of their funds with the Wisconsin Funer-
al Directors Association master trust will likely lose
money on the preneed contracts they’re fulfilling to-
day. Don’t let this happen to you. Do your research
first and determine what qualifies as a sound, safe and
honest trustee. Always “trust, but verify.”
William H. (Bill) Williams, Jr,
is a Florida licensed
funeral director with more than 35 years of experience in
the death care industry. In 2001, Bill became vice presi-
dent of
Funeral Services Inc.
(FSI), one of the nation’s
oldest and largest death care trust administration com-
panies. In 2003, Bill was elected to FSI’s board of direc-
tors and appointed president of the company. Bill cur-
rently serves as president/CEO and vice-chairman of the
board of FSI, a member of the board of directors of Sabal
Trust Company, and a member of the board of directors
of Infinity Management Advisors, LLC.
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