Senate Bill 1682 Information
FAQ | Trust Verification Form | Consumer Protection Form | Bank Confirmation Form
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Pre-Need Funeral Consumer Protection Fund -SB 1682 established a consumer protection fund for pre-need funeral contracts. This state fund may provide restitution to consumers when a funeral home does not provide the goods or services for which the consumer contracted. A similar provision currently applies to pre-need cemetery contracts.
Section 1a-2 of the Illinois Funeral or Burial Funds Actrequires licensees to pay $5 for each pre-need contract sold and must forward to the Comptroller’s Office this sum semi-annually. Attached is the Pre-Need Funeral Consumer Protection Funds Fee Payment Record, which must be completed and returned to the Office of the Comptroller by July 30, 2010, for contracts written between January 1, 2010 and June 30, 2010.Checks should be made payable to the Pre-Need Funeral Consumer Protection Fund
- Corporate Fiduciary- All pre-need sales must be entrusted with a corporate fiduciary regardless of the size of the trust fund. This provision is extremely important especially for those who are transitioning their trusts. Because so many licensees are moving their trusts at this time, the Illinois Office of the Comptroller needs each licensee to sign and notarize a Bank Confirmation of the depository where the Trust funds are held. If there are multiple depositories please provide a Bank confirmation for each one. We have attached an authorization form for your convenience. Please provide our office with this updated Bank Confirmation by July 30, 2010.
Senate Bill 1682 significantly amends the Illinois Funeral or Burial Funds Act and the Pre-Need Cemetery Sales Act. We anticipate SB 1682 will take effect on January 31, 2010. A Public Act reference number will be assigned once the Governor’s Office certifies the effective date change approved by the Governor and General Assembly this past legislative veto session. The primary provisions of SB 1682 are summarized below. You are encouraged to review the bill in its entirety and consult with your attorney in complying with the new provisions.
Independent Trustee --- Consumer pre-need trust funds must be placed with an independent trustee that is a corporate fiduciary. Funds held by a corporate fiduciary will be regulated by the appropriate state or federal regulator. Here are some suggestions for ensuring compliance with the new provisions:
Determine whether your pre-need trust funds are currently with a corporate fiduciary. You can check this by referring to the following websites:
Illinois Department of Financial & Professional Regulation - www.idfpr.com
Office of the Comptroller of the Currency –HelpWithMyBank.gov
Or, by contacting the following toll-free consumer hotline: Illinois Department of Financial and Professional Regulation - 877/793-3470.
If your trust funds are currently deposited with a corporate fiduciary, complete the attached form and forward to IOC a copy of the current fully-executed trust agreement
If your trust funds are not currently deposited with a corporate fiduciary, you must finalize a transfer of your pre-need trust funds to a corporate fiduciary, complete the attached form and forward to IOC a copy of the fully-executed trust agreement. (Please note that this does not automatically require liquidating current trust fund assets before transferring or assigning assets to an independent trustee. For instance, certificates of deposit can usually be assigned to the new trustee without penalty. Again, consult with your own attorney or financial advisor concerning advice on how to best transfer assets to an independent trustee that is a corporate fiduciary.)
Notice to Consumers --- Your independent trustee must provide an annual notice to all consumers of the status of their funds including an explanation of any fees charged by the trustee, an explanation of the purchaser’s right to a refund and identification of the primary regulator of the trust or insurance company under state or federal law. Here are some suggestions for ensuring compliance with the new provisions:
- Be sure the corporate fiduciary or insurance company that you use is aware of this requirement.
- Be sure the corporate fiduciary or insurance company provides you with a copy of the annual notice.
- Retain a copy of this annual notice in your file.
Funeral Consumer Fund --- SB 1682 establishes a consumer protection fund for pre-need funeral contracts. This state fund may provide restitution to consumers when a funeral home does not provide the goods or services for which the consumer contracted. A similar provision currently applies to pre-need cemetery contracts. Licensees are required to pay $5 for each pre-need contract sold and must forward to the Comptroller’s Office this sum semi-annually. At that time, each licensee will be notified with instructions and forms.
Additional Audits --- Licensees must bear the full cost of the examination or audit, up to a maximum of $20,000. SB1682 also reduces the notice period from 30 days to 10 days.