News

LAWSUIT UNLIKELY TO IMPACT PINE BLUFF CEMETERY

By Larry Ault/OF THE COMMERCIAL STAFF
Saturday, July 15, 2006 9:18 PM CDT

An attorney for the Arkansas Securities Department said Friday it is unlikely a lawsuit in Tennessee facing the owner of four Arkansas cemeteries, including one in Pine Bluff, will have any impact on his Arkansas business interests.

“We don’t know if anything is going to happen,” said Mike Spades, an attorney for the Arkansas Securities Department, which has been monitoring the business activities of Clayton Smart of Okmulgee, Okla.

“It sounds to me like a public relations disaster,” Spades said of a recent press conference in Memphis.

During that meeting, Smart reportedly said that more than 13,000 policy owners with Forest Hill Funeral Homes will have to pay thousands of dollars more for burial services. These customers believed they were fully covered by decades old contracts.

Smart’s holdings include Memorial Park on Dollarway Road. He has been under investigation by Michigan and Tennessee authorities for allegedly redirecting millions of dollars from cemetery trust funds to personal projects.

A class action lawsuit was filed in a Tennessee court recently that alleges Forest Hill Funeral Home intentionally deceived customers who bought pre-need burial policies believing that the contracts would be fully honored.

“I feel confident we have protected that here,” Spades said, referring to a decision by the Arkansas Cemetery Board that trust funds deposited with three Arkansas banks cannot be transferred by Smart without permission of the board.

“The issue right now deals with the funeral homes, not the cemeteries,” Spades said.

He said customers in the Memphis area prepaid for their funerals but Smart reportedly took the position he doesn’t have to honor those agreements without additional payment.

Referring to the management of the Arkansas cemeteries, Spades sad that if there is a problem here “I think the board will be prepared to deal with it.”

If Smart should decline to assist people or honor agreements for funerals in Arkansas, Spades said he believes the cemetery board will take quick action.

In July 2005, Smart received permission from the Arkansas Cemetery Board to assume management of Memorial Park at Pine Bluff, Edgewood Memorial Park in North Little Rock, and Arlington Park Cemetery and Rest Haven Memorial Park in El Dorado. He began management of the cemeteries after they deteriorated under the ownership of Houston-based Cemetery Holdings.

Print this story   |   Email this story