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Missouri AG sues over preneed funeral contracts
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By CHRIS BLANK
Associated Press Writer
Attorney General Jay Nixon filed a lawsuit Wednesday against several funeral homes and a seller of prearranged funeral plans.
The lawsuit accuses the Creve Coeur-based Mason Securities Association of keeping too large a portion of the money from preneed contracts, failing to sign the contracts and mixing its assets from preneed contracts with those from National Prearranged Services, which in April agreed to stop selling prearranged funeral contracts in Missouri.
The suit filed in St. Louis County names other defendants including the Forever Network Inc., of Creve Coeur; Mount Washington Forever LLC, of Independence; MWC Properties Inc., of Independence; and Forever Oak Hill Inc., of Kirkwood.
Nixon's office asserts the companies are linked to National Prearranged Services. An attorney representing the Forever Network said that the companies had been affiliated with National Prearranged Services but are no longer tied to the company because the Texas commissioner of insurance has taken it over.
Forever Network attorney Jack Spooner said that the Missouri lawsuit was filed after a Division of Professional Registration audit of the Mason Securities Association identified violations that have been corrected. He said the audit spanned from July 1, 2007, to May 12.
For example, the audit discovered that the Mason Securities Association was depositing money from preneed contracts into accounts that already had funds, including ones from National Prearranged Services. Spooner said the Mason Securities Association agreed to create a separate account.
All five Missouri companies named in the lawsuit are accused of using money from the sold contracts to buy renewable term life insurance polices and missing payments on the premiums. Nixon's lawsuit also accuses the companies of using the term life insurance polices, which have no cash value, to fund preneed funeral trusts, and buying the policies through Lincoln Memorial Life Insurance Co., a Texas-based insurance company linked to National Prearranged Services.
Spooner said National Prearranged Services bought term life insurance but that the Mason Securities Association hasn't bought any life insurance.
Missouri's lawsuit asks that the Mason Securities Association's registration to sell preneed contracts be suspended or revoked, that all five companies and their employees be blocked from selling preneed contracts and that assets of the companies be frozen.
Iowa and Illinois have also barred National Prearranged Services from selling preneed funeral services. Kentucky, Ohio and Texas have directed Lincoln Memorial Life Insurance Co. to suspend new insurance business.
The lawsuit accuses the Creve Coeur-based Mason Securities Association of keeping too large a portion of the money from preneed contracts, failing to sign the contracts and mixing its assets from preneed contracts with those from National Prearranged Services, which in April agreed to stop selling prearranged funeral contracts in Missouri.
The suit filed in St. Louis County names other defendants including the Forever Network Inc., of Creve Coeur; Mount Washington Forever LLC, of Independence; MWC Properties Inc., of Independence; and Forever Oak Hill Inc., of Kirkwood.
Nixon's office asserts the companies are linked to National Prearranged Services. An attorney representing the Forever Network said that the companies had been affiliated with National Prearranged Services but are no longer tied to the company because the Texas commissioner of insurance has taken it over.
Forever Network attorney Jack Spooner said that the Missouri lawsuit was filed after a Division of Professional Registration audit of the Mason Securities Association identified violations that have been corrected. He said the audit spanned from July 1, 2007, to May 12.
For example, the audit discovered that the Mason Securities Association was depositing money from preneed contracts into accounts that already had funds, including ones from National Prearranged Services. Spooner said the Mason Securities Association agreed to create a separate account.
All five Missouri companies named in the lawsuit are accused of using money from the sold contracts to buy renewable term life insurance polices and missing payments on the premiums. Nixon's lawsuit also accuses the companies of using the term life insurance polices, which have no cash value, to fund preneed funeral trusts, and buying the policies through Lincoln Memorial Life Insurance Co., a Texas-based insurance company linked to National Prearranged Services.
Spooner said National Prearranged Services bought term life insurance but that the Mason Securities Association hasn't bought any life insurance.
Missouri's lawsuit asks that the Mason Securities Association's registration to sell preneed contracts be suspended or revoked, that all five companies and their employees be blocked from selling preneed contracts and that assets of the companies be frozen.
Iowa and Illinois have also barred National Prearranged Services from selling preneed funeral services. Kentucky, Ohio and Texas have directed Lincoln Memorial Life Insurance Co. to suspend new insurance business.
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