Police: Burial money diverted

Published 8:07 am Tuesday, June 10, 2014

Former Greenville funeral home director Douglas “Dusty” Harrison was arrested Monday charged with six counts of theft of property. (File Photo)

Former Greenville funeral home director Douglas “Dusty” Harrison was arrested Monday charged with six counts of theft of property. (File Photo)

Former Greenville funeral home director Douglas “Dusty” Harrison was arrested Monday and accused of using money intended for customers’ future funeral needs to run his business.

Harrison, 57, has been charged with six counts of theft of property.

According to Lt. Justin Lovvorn, the Greenville Police Department received its first complaint on Harrison and Harrison Funeral Home in January and began looking into his business practices with the assistance of the Secret Service and the Internal Revenue Service.

Lovvorn said the complaints stemmed from Harrison’s selling of preneed contracts without a certificate of authority and the mishandling of the funds. According to the Alabama Board of Funeral Services, Harrison Funeral Home sold more than $250,000 in pre-need contracts from 2004 to 2013 without a certificate of authority (COA) granting the establishment the right to enter into such contracts. The funds, according to the board, were also not placed in a trust, but rather were used to help cover the operating expenses of the funeral home.

Pre-need funeral contracts are a means to prepay for funeral services. The money goes into an account and accumulates interest. When a person dies, the money from that account is used for funeral arrangements.

“After Lt. Joey Disney collected a number of statements from victims, we obtained a search warrant for the premises, and myself and agents from the other two agencies inventoried the records and computer logs for the business,” Lovvorn said. “Once we got into the records there was enough there to show that he intended to defraud the people who paid for the contracts.”

In November of 2013, the board revoked the establishment permit of Harrison Funeral Home in Greenville and Harrison’s service license.

“For years Mr. Harrison sold pre-need contracts with complete disregard for the laws of the State of Alabama,” said Cameron McEwen, legal counsel from the Attorney General’s Office.

On June 21, 2012, the Alabama Department of Insurance issued Harrison Funeral Home a cease and desist order, preventing the funeral home from offering, selling, entering into or collecting payments on pre-need contracts.

During a November hearing held by the Alabama Board of Funeral Services, two witnesses testified that they purchased pre-need contracts from Harrison Funeral Home in October of 2012.

“Mr. Harrison continued to sell the pre-need contracts well after the cease and desist order was issued,” McEwen said.

During testimony, Harrison acknowledged that his funeral home had sold pre-need contracts without a COA, and that the funds had been placed in funeral home’s general operating budget, but said that he had not yet failed to honor one of the contracts.

“I have fulfilled every one of them,” he said.

Harrison said that his funeral home, which he owned and operated since 1987, didn’t actively seek to sell pre-need contracts.

“We didn’t solicit them,” he said. “We weren’t out ringing doorbells or calling people trying to sell them these contracts. These were people we had known for years that came and asked us to do this. I was aware that we were selling them without a COA, and that was wrong.”

Lovvorn said other arrests in the case are forthcoming.

Federal charges may also be filed once the Secret Service and the IRS complete their investigation.

“They confiscated the records they need for their investigation, which is ongoing,” Lovvorn said. “They said their investigation usually takes about a year.”