Bill to strengthen protections for prepaid funeral clients on P.E.I. passes 2nd reading

Legislation aimed at protecting Prince Edward Islanders who pay in advance for funeral services has passed second reading in the P.E.I. legislature.

The amendment to the Pre-arranged Funeral Services Act would require funeral homes to maintain a bond, or another form of security, against the deposits that customers put down. These funds could be used to compensate clients in the event of fraud or misconduct.

The proposed changes would also require funeral homes to provide proof that client deposits are held in a trust account. These accounts would be subject to audits by the P.E.I. Funeral Services and Professions Board.

This comes after dozens of families were defrauded of more than $400,000 in prepaid funeral money by former Island funeral director Lowell Oakes.

Oakes, the former owner of Dawson Funeral Home in Crapaud, was sentenced last year to two years minus a day in jail and was released early on day parole.

That followed his conviction on 66 counts of fraud, 36 of which were for fraud over $5,000. Oakes told his victims the money was going into a trust, as required by law, but the trusts were never created. 

RCMP found cases that went back as far as 1996.

Nothing in the bill will apply retroactively to people cheated by Oakes, however.

Green MLA Matt MacFarlane, who has been advocating for the victims, said the province bears some responsibility and should provide them with compensation.

"Government had over 40 years to make regulations exactly along the lines of what we're seeing in the legislation today. There could have been an onus put on funeral home operators back then, as we're seeing now, to have security in place to cover any misdeeds," MacFarlane told CBC News.

"That was on government to do that and government failed to do that."

MacFarlane said there's a lack of specific details in the current bill regarding a compensation fund for future victims of similar fraud. He noted the significant amount stolen by Oakes to fuel his gambling addiction — more than $400,000 — and hopes this case will set an appropriate benchmark for any future compensation.

"I'm hoping that that precedent will set the parameters appropriately for future victims of such crimes," the MLA said.