MEMPHIS (CN) – A class of Tennesseans say they were cheated of prepaid funeral services because Forethought Federal Savings Bank used their money to take out life insurance on them. They say a funeral home and cemetery took their money and deposited it with the Forethought Bank, which used the cash to buy life insurance on them from its subsidiary, Forethought Life Insurance.
The class says they had no idea that life insurance policies had been taken out on their lives.
Forest Hill Funeral Home and Tennessee Cemeteries are not named as defendants in the lawsuit, but are named as co-conspirators. They allegedly transferred the trust funds and insurance policies to Community Trust and Investment Company.
Community Trust allowed the insurance policies to be surrendered for cash, the class claims, and took out extra for “substantial surrender charges.” Fees were charged and unauthorized withdrawals were made, and the class says there was not enough money left to pay for their burial and funeral services.
They sued Community Trust, Forethought Federal Savings Bank and its subsidiary for breach of fiduciary duty, negligence, conversion, fraud and civil conspiracy.
They are represented by Bruce Brooke with Fargarson & Brooke of Memphis and Albert Lewis III with Lewis & Smyth of Tuscaloosa.