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Mortuary head ordered to stop sales of contracts PDF Print E-mail
Written by DeadGirl   
Saturday, 09 September 2006
Trust-funded benefit contracts require a permit, officials say

By Mary Ann Cavazos
Corpus Christi Caller-Times
September 8, 2006


Noe Lopez, owner of Saxet Funeral Home Inc. and Caskets & More, must stop selling trust-funded benefit contracts and collecting associated funds after receiving a cease and desist order from the Texas Department of Banking.

The order, issued Aug. 21, states Lopez violated Chapter 154 of the Texas Finance Code by collecting funds from the sale of trust-funded prepaid funeral benefits contracts without a permit issued by the department.

The department licenses and supervises more than 400 of the state's prepaid funeral contract sellers.

Sheila Armstrong, program specialist with the department, said the order applies only to the payments Lopez accepted from clients through the funeral home after the store closed. A casket store is required to have a permit unless the goods are delivered within 72 hours of the purchase.

Lopez said Caskets & More, previously on Everhart Road, has been closed since November 2005 and any funds he received after the fact were to settle previous contracts. The funeral home on Leopard Street has been in operation for about three years and will continue to operate, he said.

"We're dealing in good faith. We don't think we've broken any rules," Lopez said. "We're just honoring the agreements from before."

Lopez said he wasn't aware the store needed a permit to sell prepaid funeral benefits contracts because the funeral home never has needed to register for a permit.

"We do not have a permit, but neither do lots of funeral homes," he said, explaining the funeral home instead uses a licensed insurance company for contracts.

Armstrong said the order doesn't apply to any of the contracts approved through the licensed insurance company and will not close the existing funeral home.

"It applies to the funds he continued to accept after the casket store closed," she said.

A hearing will be set to establish if fines will be issued. Fines could be as much as $1,000 per contract per day, according to Armstrong.

http://www.caller.com/ccct/local_news/article/0,1641,CCCT_811_4977698,00.html
 
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