Funeral Industry News

Cemetery Operator Pleads Guilty to Stealing Millions

September 29, 2009

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Cemetery Operator Pleads Guilty to Stealing Millions

imageA Grand Rapids, Mich., cemetery operator has pleaded guilty to two felonies for embezzling more than $4.2 million in cemetery trust funds from Chapel Hill Memorial Gardens in Grand Rapids, and failing to properly administer numerous funeral contracts over a three year period.

“Stealing from the dead is a betrayal of the highest order,” said Michigan Attorney General Mike Cox, who brought the case against 41-year old Robert Earl Nelms. “Families who have laid their loved ones to rest have a rightful expectation that this sacred ground will forever be protected.”

Nelms pleaded guilty to one count of embezzlement and one count of failing to trust funeral contracts. Nelms will serve a prison term of 20-120 months for the embezzlement charge and 20-60 months for the failure to trust count.

Nelms, who resides in Indiana, also must pay restitution of more than $4,256,000.00, which will be returned to the cemetery’s trust accounts. If Nelms fails to pay restitution at the time of his sentencing, he will be required to serve 3 to 10 years in prison for embezzlement and 3 to 5 years for the failure to trust.

In December 2007, a joint Attorney General and Department of Energy, Labor, and Economic Growth investigation uncovered the theft, resulting in criminal charges and forcing Nelms to lose control of Chapel Hill Cemetery.

In total, it is alleged Nelms stole more than $24 million from cemeteries and funeral homes he controlled in Michigan and Indiana. He did this by selling cemetery products and services but failing to deposit the required portion in trust for cemetery upkeep and consumers’ use. Approximately $4.2 million dollars were from the Grand Rapids cemetery, with Nelms facing charges in Indiana for the rest, Cox said.

Bereaved consumers should always make sure they are dealing with a reputable funeral service provider. In July hundreds of outraged families brought a class action suit against an Illinois cemetery accused of illegally interring remains and altering grave sites in the name of profit. Employees of the Burr Oak Cemetery in Chicago allegedly stacked and disposed of bodies in an attempt to create space at the graveyard in order to maximize their income. They also allegedly desecrated and destroyed bodies in order to resell the plots on which they were buried.

In Michigan, Cox said this is the second defendant to be convicted for involvement in a major theft of cemetery trust funds. Carter Green of Nevada was convicted in Wayne County Circuit court in December of 2007 for his role in aiding co-defendant Clayton Smart.

Cox alleges that Smart embezzled as much as $70 million in cemetery trust funds from 28 Michigan cemeteries. Clayton Smart is awaiting trial in Tennessee on related charges. Upon completion of that trial, Smart will be transferred to Michigan for arraignment on charges filed by Cox.