A decade-long criminal fraud in the prepaid funeral business has or will cost multiple state agencies, consumers and funeral homes more than $600 million, federal prosecutors claim in an indictment unsealed Friday.?
The indictment charges the president and chief financial officer of Clayton-based National Prearranged Services Inc., Randall Sutton, 63, with six felony counts of mail fraud, one felony count of money laundering and two felony counts of wire fraud. Sutton was also the director of two associated Austin, Texas, life insurance companies, Memorial Service Life Insurance Co. and Lincoln Memorial Life Insurance Co.
The indictment accuses Sutton, of Chesterfield, and unidentified “others” of running multiple scams to siphon millions out of the prearranged funeral services industry through contracts sold in 19 states.
“The losses resulting from the business failure will far exceed 600 million (dollars),” said Assistant U.S. Attorney Jeff Jensen. That estimate is for the cost to insurance guaranty associations, which step in when an insurance company goes out of business or becomes insolvent. Jensen said customers and funeral homes stood to lose many millions more.
“Our job as prosecutors is to try to sort out how much of that loss resulted from fraud,” he said. “This indictment is the beginning of that sorting-out process.” Jensen would not name the “others” in the indictment, the only one so far related to NPS. He said the investigation is continuing.
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