Tuesday, May 6, 2014

Commissioner Signs Cease and Desist and Consent Order with Cemetery

Iowa Insurance Commissioner Nick Gerhart has signed a consent order with Waterloo Memorial Park Cemetery.  The Insurance Division is the state agency which oversees perpetual care cemeteries such as Waterloo Memorial and also regulates the sale of preneed goods and services offered by funeral homes and cemeteries in Iowa.  In May of 2013, the Division and the Cemetery had entered into a voluntary agreement and consent order regarding the need to correct a number of deficiencies that existed in the operation and cash management of the cemetery described in that earlier order.

This spring, the Division became aware that the stipulations of the 2013 order were not being met, especially with regard to its financial stability and practices, the filing of required annual reports, payments of fees and a lack of active management of the Cemetery.

The terms of the new consent order include: the freezing of all accounts with financial institutions, a requirement that the cemetery retain a qualified operations manager for at least 30-90 days, an additional requirement that the cemetery retain a qualified accountant to conduct financial reviews specified by the Division, the filing of required forms and the completion of an information request submitted by the Division, compliance with all provisions of the 2013 consent order, the cessation of all preneed sales activity and finally the establishment of a source of available funding of $50,000 as an operating account to be used by the Operations Manager.

“It has become clear that this cemetery is struggling, “ said Gerhart, “ It’s not where it needs to be in its operational plan or its financial accounting practices. We believe it is possible to reverse these problems, given appropriate oversight.  The specific processes outlined in our order provide this cemetery and its customers with a path forward to a healthier status.”

Waterloo-based Genesis Memorial Group has been selected by the cemetery board as the operating manager for the satisfaction of this order.  The board also made the decision to hire McGladrey, LLP as the accountant for these purposes. Waterloo Memorial Park Cemetery remains open for business with its regular business hours.