Indiana funeral director faces nine felony counts of insurance fraud

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A Henryville, Ind., funeral home operator is facing nine felony counts of insurance fraud for cashing in “pre-need” burial insurance plans, unbeknownst to the holders of those policies.

Richard Duane Pyke, 42, who runs R.D. Pyke Funeral Services, was recently arrested by Indiana State Police following a four-month investigation by law enforcement officials and state regulators, according to The Courier Journal (Louisville, Ky.).

Pyke is accused of receiving more than $65,000, beginning in March 2005, for submitting falsified documents indicating that a person who bought a “pre-need” burial insurance plan from him had died, when eight of the nine people were still alive and thought their coverage was still in place, the report said.

An investigation began in September 2009 when a woman contacted Indiana State Police after learning her father’s burial insurance was cashed in four years earlier. Court records indicate that Pyke notified the insurer, Homesteaders Life Co., that the woman’s father had died when he was actually still alive. That policy was reinstated.

State police also investigated a similar incident where a woman checking on the policy of her 90-year-old mother in October 2009 learned from Forethought Life Insurance Co. that Pyke allegedly filed a death claim stating the woman had died in March 2006, according to the report.

Regulators at the Indiana Professional Licensing Agency later learned that eight people had their insurance polices bought through Pyke cashed in; of the eight, seven are still alive and one died after the policy was cashed out.

The Clark County Prosecutor’s Office is continuing to look for additional victims of the scheme who bought pre-paid funeral insurance from Pyke.

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