3 Steps Funeral Directors Can Take for Fraud Prevention
Posted April 28, 2021
7 min read
A Funeral Director in Michigan received a call one afternoon from a family that was in Spain on vacation.
The man on the other line was extremely upset.
He said his wife had died while on their trip. Both shocked and also overwhelmed, he didn’t know what to do to get her back to America. “I need your help. How do I do this?” he said.
Wanting to help as much as possible, the Funeral Director took down all his information—the wife’s name, information on the Spanish Consulate, details about the hospital she was at in Madrid, and more.
At the end of the call the man told her, “I’m headed to the Spanish Consulate now. I’ll give you a call when I’m there.”
Several hours later, the man called the Funeral Director back. “I’m at the Spanish Consulate. I’m here with someone who can help me get my wife back to America. He wants to talk to you.”
Another man got on the phone to talk to the Funeral Director. Speaking with a Spanish accent he said, “We have our Funeral Director here who can take care of the embalming and who will get the documentation. We can secure all the paperwork here,” he said, “and the Consulate fees are $3,000 for us to handle it.”
Another conversation then took place with the husband of the deceased. “Okay, so how does this work?” he said to the Funeral Director. After that phone call, the Funeral Director outlaid money for the flight to get the body back to America.
Then, the Consulate called her back. “We have all the documentation now. You can wire us $3,000 for the fee,” he explained. The Funeral Director felt uncomfortable, but also felt the desire to help, so she sent the additional money via wire transfer.
“In this story, there is no one that died. It was all a ruse. And that’s how fraud takes place,” says Dr. David Penepent, a Funeral Director who is also the Funeral Services Administration Program Director and a professor of mortuary science at the State University of New York at Canton (SUNY Canton).
With more than two decades of experience in funeral service, David helps to teach and educate other funeral professionals on actionable steps they can take to help reduce the likelihood they become fraud victims.
Stories like this one show how the trusting and compassionate nature of funeral professionals is part of what can make them more susceptible to fraud. “People do die on vacation, and the Funeral Director is conditioned to help people, and that’s how fraud can happen.”
In our last blog we covered many of these insights you should know about, but here we cover 3 additional steps you can take to further protect your Funeral Home.
Step 1: Trust But Verify
In the case of the Spanish Consulate, the one important thing that could have prevented that from happening is the Funeral Director should have called the Spanish Consulate in the nearest metropolitan area. “If they did, they could verify that this was actually the Spanish Consulate that called, and that would have prevented the fraud from happening,” says David.
If there’s anything that is questionable or anything that makes you feel uncomfortable, don’t delay in verifying the information. If your gut is telling you something is wrong, it could be the case. After all, scammers are often very sophisticated, says David. “Remember, these people that commit fraud are very good at what they do and they are very believable. They will act, and they will get emotional—they will even cry on the phone. They tug at the Funeral Director’s emotional element that makes him or her great at what they do.”
Step 2: Be Vigilant About Protecting Your Assets
Funeral Directors need to be very careful about protecting all their assets—and in today’s digital age, that includes passwords.
David shares the story of a Funeral Home owner who trusted his secretary enough to give her passwords to his retirement account. Each year she would deposit money into the account on his behalf.
One night, the Funeral Home owner saw that his entire account—hundreds of thousands of dollars—had been withdrawn. The next day when the secretary didn’t show up to work, he called the police.
A month later, she was found dead, and her ties to organized crime were uncovered. While the Funeral Home owner was able to get his money back from an insurance settlement, it shows just how much risk an individual takes on when sharing passwords with anyone, no matter how much they believe they can trust a person.
David says Funeral Directors need to be cautious about sharing passwords to any financial accounts, but they also need to take proactive steps to avoid their passwords getting compromised. He suggests the following:
Use strong passwords. Long and unique passwords are best. Aim to include random and complex combinations of lowercase and uppercase letters, numbers and symbols.
Don’t reuse passwords. If you reuse passwords, rogue employees or attackers will have a much easier time getting access to your files and accounts.
Change your passwords frequently. Changing your passwords regularly will help to reduce the risk of improper access.
Be careful where you enter your password. Websites that aren’t encrypted put your data at risk. Working in untrusted wireless networks can also put your data at increased risk for others to access it.
Step 3: Don’t Ignore Red Flags
“I know a Funeral Director who had a very, very successful business,” says David. “One of his employees suddenly showed up to work with a brand new sports car. And six months down the road, he had a brand new Rolex watch. And then he started wearing Armani suits.”
To most, it would appear this employee was suddenly living beyond his means. Despite the potential sign that something was amiss, the Funeral Home owner didn’t look into the situation any further.
It turns out that the employee had become involved in a body snatching ring. The rogue employee gave a third party access to bodies set to be cremated, and that group was harvesting the body parts and then selling them on the open market.
“When you’re doing 200 calls a year and half of those calls are cremation, and you’re getting $1,000 a piece, it didn’t take long for that employee to amass a large amount of money,” explains David.
Not only was it illegal for him to authorize the removal of body parts when a family has no knowledge of it, it also was part of a fraud that reflected ill will on the Funeral Home itself. As a result, the Funeral Home became liable in a multimillion-dollar lawsuit because the Funeral Home owner did not investigate the employee when he sensed that there might have been signs of a problem.
“When something looks too good to be true, it probably is, and you need to look further,” says David. “Be skeptical about everything. If it sounds too good to be true, it is too good to be true.”
Protecting Your Funeral Home From Theft & Fraud
In conclusion, Funeral Directors should trust but verify; they should be vigilant about all their passwords and protecting their assets; and they should look into any red flags that may be an early indicator of a larger problem. Trust is a great quality that funeral professionals have, but trusting people in every situation means you’re taking on undue risk.
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