Families in limbo after Hartselle funeral home unexpectedly closes

By David Gambino 

For the Enquirer 

Clients of Hartselle Heritage Funeral Home are left wondering what’s become of their policies to cover funeral costs after the business unexpectedly shut its doors in early May. 

July 26, Jeffrey Brown, former funeral director of the business at 1401 Main St. E., said he was “still working on” transferring clients’ preneed contracts — written contracts to provide funeral services — to other funeral homes, including Peck Funeral Home in Hartselle and Shelton Funeral Home in Decatur. 

Until Brown forwards up-to-date preneed financial information, clients are unable to transfer their contracts or use their preneed funds to pay for funerals. 

“Brown has been telling me he’d get us the reports since May,” said Russ Beard, manager of Shelton Funeral Home. 

The manager of Peck Funeral Home, Geoff Halbrooks, said he has known Brown for many years. He wasn’t aware Brown’s business closed until one day he noticed its grass hadn’t been cut. 

“That financial information is not difficult to get in a timely manner, not at all,” he said. “Those reports should be on-hand with the funeral director. In my opinion, there’s no good reason to still not have updated financial information passed between two funeral homes within two months.” 

The Alabama Department of Insurance handles preneed regulation. 

Alabama Preneed Regulation chapter 482-3-005 states: “Certificate holders selling preneed contracts for funeral and cemetery merchandise and services shall maintain accurate and up-to-date types of records … in a manner so as to be readily retrievable.” 

Certificate holders, that is, funeral directors, are required to submit at least two reports yearly to the Department of Insurance: “The semi-annual report includes, but is not limited to, the balances of trusts, the value of insurance, and the number of contracts written, fulfilled, or canceled.” 

Furthermore, funeral homes are required by the Department of Insurance to maintain a log of all preneed merchandise and services sold. These logs are required to be updated at least quarterly. 

Preneed Regulation chapter 482-3-006 states: “A certificate holder shall maintain detailed records for each preneed contract written. The detailed records shall include all supporting documentation, such as … annuity contracts or proof of deposits in trust” and “quarterly trust statements.” 

Beard said he’s waiting on updated financial reports before Shelton Funeral Home can accept preneed contracts previously held by Hartselle Heritage. 

“What I’m looking at are reports from 2019 and 2015,” he said. “I don’t know where the money is at. I’ve not received that from him yet.” 

Brown said his trust-funded preneed contracts are through a company called Funeral Services Inc. (FSI) based in Tallahassee, Florida. 

According to Brown, record filing with the Department of Insurance is done by the companies that handle the money. 

Department of Insurance guidelines state “the certificate holder is responsible for submitting the statements, not the trustee or insurer(s).” 

The CEO of FSI, Bill Williams, said Brown should have records for every one of his preneed contracts. 

“We have all the information related to the trust, not to the individual contracts,” Williams said. “He never gave us the information — the records for the individual contracts — so we just have how much money he has in trust. It’s in one big pot.” 

Williams said that, while his company does all the record keeping for the majority of his clients, it’s not unusual for funeral homes to keep their own records. 

FSI didn’t learn Hartselle Heritage closed until this month. 

“I don’t know the reason he closed; I have no clue,” Williams said. “The thing is it gives the entire industry a black eye when something like this happens.” 

Brown said Wednesday that he notified FSI of the closure when they called him “a couple of weeks ago.” 

Brown said he waited so long to tell them because he wasn’t sure if he was going to close completely. He said he was thinking of opening in another location. 

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Families affected 

Brenda Eubanks, 71, tried to contact Hartselle Heritage around the second week of May after her 89-year-old mother moved into a nursing home. For her mother to qualify for Medicaid, her preneed contract needs to be changed from revocable to irrevocable. Otherwise, the funds count as an asset. 

“That’s the only thing holding her back,” Eubanks said. 

When she received no response from Brown, she drove up to Hartselle from Birmingham twice. 

“The doors were locked and there weren’t any cars in the parking lot,” she said. 

Unsure of what to do, she reached out to the Department of Insurance, which told her to contact Shelton Funeral Home. 

“After meeting with Russ Beard, we started trying again to get in touch with Brown, because we needed to change the contract and nobody could do it but him,” she said. 

Eubanks said it took them weeks to find out her mother’s funds were placed in trust with FSI. 

“When we called (FSI), they didn’t even know Brown was not in business anymore,” she said. 

Eubanks said she hasn’t spoken to Brown since June. She claims he doesn’t answer the phone when she tries calling. 

Her mother’s 90-day grace period with Medicaid will end next month. After repeatedly running into dead ends, Eubanks decided to hire a lawyer to help compel a response from Brown. 

“We need a current statement on the account proving the money is there,” she said. “And then we need to make arrangements to change the contract or get the money back, and he has not done any of those things.” 

July 27, Beard said he’s only been able to accept two preneed transfers from Hartselle Heritage to date. He said he was able to accept the preneed contracts of a husband and wife because it was funded through their insurance policy. 

“I still haven’t seen anything on the trust-funded preneeds, no,” he said. “My hands are just kind of tied right now.” 

Beard said he’s had 10 to 15 families who had their preneed contracts through Hartselle Heritage contact him. 

“I feel for these families that have pre-arrangements and are wondering what’s going to happen,” he said. “My number one concern is for these families.” 

Halbrooks said he has not received any up-to-date preneed financials from Brown, either. 

“Not at all,” he said. 

Williams said FSI has no regulatory authority to work with anyone other than Brown, since he’s the certificate holder. 

“Now that he’s gone, the Department of Insurance has got to step in and say: This is what you need to do with the money,” he said. “We have not received that guidance, and we’ve asked for it.” 

Without up-to-date preneed contracts from Brown, Williams said other funeral homes won’t have a clue what kind of contracts they would be taking over.

Brown claimed he’s begun transferring preneed contracts to other funeral homes. 

“Right now, it’s pretty much piece by piece until I can get all the financials,” he said.