Funeral home fined by state
State regulators have fined a Durham funeral home $500 and put it on probation for two years over record-keeping problems involving the advance sale of its services.
The action targeted Scarborough & Hargett Funeral Home Inc., which operates at 928 Old Fayetteville St. in the Hayti district.
It grew out of an examination of the home’s books last year by an inspector from N.C. Board of Funeral Service. The consent order was the board’s second in recent years involving Scarborough.
The first, in 2007, was for the same sort of problems and resulted in a $7,000 fine and three years’ probation.
Regulators opted for a lesser penalty this time around because Scarborough’s “record-keeping has improved noticeably” since 2007, said Pete Burke, the state board’s executive director.
“They are making progress,” though there are still “some things that need to be fine-tuned and made better,” Burke said.
Scarborough & Hargett’s co-owner, J.C. “Skeepie” Scarborough, likewise said he and his colleagues have acted to correct the problems.
“We were together in getting things the way they would like for it to be,” Scarborough said on Wednesday.
North Carolina licenses and regulates funeral homes, paying particular attention to what state law terms “pre-need” contracts with families that pay in advance against the certainty of one day needing a home’s services.
Burke said the various types of pre-need arrangements can include hedges against inflation and typically require deposits into a trust account or backing from an insurance policy.
The state insists that all those transactions be carefully booked, and requires frequent reports to the Board of Funeral Service.
Last year’s examination – a multi-day affair in May with many of the trappings of an audit – found problems with the booking of receipts, journal updates, the reporting of insurance lapses and other issues. All told, it identified violations of eight statutes or regulations.
The board also looked into allegations from a client of Scarborough & Hargett’s that the home had failed offer price lists before opening negotiations on funeral arrangements.
Scarborough & Hargett disputed the allegations. But they would have translated into three more violations if the board deemed the client’s account more credible, the consent order said.
The regulatory tangle is the latest difficulty for a family-owned business that’s operated in Durham since 1900.
Last decade, it was forced by the county to move out of quarters on South Roxboro Street to make way for construction of Durham’s new courthouse.
J.C. Scarborough hoped to move the home into a new, custom-designed building in UDI Industrial Park. But that project stalled in 2008, after construction was under way, due to soil problems and a dispute with builders.
The abortive move sparked a lawsuit by Scarborough against the builder, L.A. Downey & Son Inc. Downey countersued. The two sides settled out of court last November, reaching an accord amid a jury trial.
Scarborough on Wednesday said a resumption of the UDI project is “off the table” and that he’s now pursuing a relocation option he first considered more than a decade ago.
He added that his business was founded in 1871, has operated continuously ever since and is now “the fifth oldest black funeral home in the United States.”
In dealing with the state, “we’ve tried to show we adhere to those principles we’ve had in the past to get us to where we are now,” Scarborough said.