Category

Business Fraud

Class-Action Status Granted To Claims That Detroit Funeral Home Mishandled Remains Of Numerous Fetuses And Babies

By | Business Fraud, Class Action Lawsuits

On November 5, 2018, a judge granted class-action status for the claims against a Detroit funeral home, Wayne State University, and a local cemetery in which it is alleged that the defendants mishandled the remains of more than 200 babies and fetuses. On October 19, 2018, the Detroit Police Department reportedly removed 63 fetuses (36 fetuses in boxes and an additional 27 fetuses in freezers) from the defendant funeral home. Another Detroit funeral home was raided by Detroit police investigating similar allegations against that funeral home, where the remains of 10 fetuses and one infant were found hidden in a ceiling compartment on October 12, 2018, according to reports.

The Michigan  Department of Licensing and Regulatory Affairs (“LARA”) had announced on November 1, 2018: “Due to an increase in complaints and case complexity seen by the Dept. of Licensing and Regulatory Affairs’ (LARA) mortuary science regulators, Gov. Rick Snyder has formed a new team of multiple state departments to address concerns regarding funeral homes across the state.”

LARA had previously announced on October 19, 2018 the suspension of the mortuary science licenses of the defendant funeral home after its inspectors found “heinous conditions and negligent conduct at the home that included:

  • Three unrefrigerated boxes containing the remains of a total of approximately 36 deceased bodies of fetuses or infants plus a deep freezer containing an unknown number of additional deceased bodies. Some of the deceased had dates of death in 2015.
  • Respondents failed to certify and file death certificates for the dead bodies of the fetuses and infants for whom they assumed custody with the appropriate governmental authority within 72 hours of death.
  • Absent any statutory exception, the failure or refusal to properly supervise the final disposition of a dead human body after agreeing to provide the services of a funeral director within 60 days of receiving the body is a criminal violation under Section 160c of the Michigan Penal Code.
  • Respondents failed to secure permits for removal or burial of dead human bodies before interment or disposal.
  • Respondents obtained possession or embalmed the dead human bodies of the fetuses and infants without first being expressly directed or authorized to do so by a relative of the deceased persons or a person entitled to custody.”

The Detroit funeral home class action lawsuit was filed by a mother who alleged that the remains of her daughter were not handled properly after she requested that her baby’s body be donated to Wayne State University School of Medical for research purposes.

Source

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Occupational Fraud Statistics Between January 2016 And October 2017

By | Business Fraud, Occupational Fraud

The 2018 Report to the Nations from the Association of Certified Fraud Examiners reported on world-wide occupational fraud data based on an analysis of 2,690 cases of occupational fraud between January 2016 and October 2017 based on information provided by the Certified Fraud Examiners who investigated those cases.  Occupational fraud is defined as fraud committed against the organization by its own officers, directors, or employees.

The Report’s analysis of 2,690 cases of occupational fraud involved 125 countries in 23 industry categories. The total losses were in excess of $7 billion, with a median loss per case in the amount of $130,000. Twenty-two percent of the cases resulted in losses in excess of $1 million. The median duration of a fraud scheme was 16 months. The most common scheme in every global region was corruption.

The most common and least costly schemes involved asset misappropriation, with a medican loss of $114,000. The least common and most costly schemes involved financial statement fraud (10 percent of the cases), with a median loss of $800,000.

Small businesses (less than 100 employees) lost almost twice as much per scheme due to fraud ($200,000 median loss) than large businesses ($104,000 median loss). Internal control weaknesses were responsible for almost one-half of frauds.

The most common initial detection method was tips (40 percent versus 15 percent by internal audit and 13 percent by management review), with employees providing more than half of the tips.

Owners/executives represented only 19 percent of the occupational fraud cases but caused a median loss of $850,000. The losses caused by men were 75 percent larger than those caused by women. Those who had been with their company longer stole twice as much. Only 4 precent of those who committed fraud had a prior fraud conviction.

When fraudsters collude with each other, the median losses are far greater ($338,000 when three or more colluded; $150,00 when two colluded; $74,000 median loss for one fraudster). Eighty-five percent of fraudsters displayed at least one behavioral red flag of fraud.

The Report found that a majority of fraud victims recovered nothing.

The Report states: “Among the various kinds of fraud that organizations might be faced with, occupational fraud is likely the largest and most prevalent threat … There are millions of business and government organizations operating throughout the world and every one
of them, in some way, is vulnerable or potentially vulnerable to fraud committed by their employees. Most of those employees will never steal or abuse the trust that has been placed in them, but the ones who do can cause enormous damage.”

https://s3-us-west-2.amazonaws.com/acfepublic/2018-report-to-the-nations.pdf

If your business may be the victim of occupational fraud (business fraud) in the United States, email us at info@businesslitigationcontingencylawyers.com or telephone us toll-free in the United States at 800-756-2143 to find business litigation contingency lawyers who may handle your business fraud matter on a contingency basis.

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