Madera mortuary accused of overcharging Madera County coroner’s office

A Madera mortuary owner was arrested Thursday on charges she’s been bilking Madera County on coroner’s services.

Smith Manor Grace Chapel co-owner Sharlane Smith was arrested for overbilling that sheriff’s Lt. Bill Ward said appears to have extended for “many years.”

Detectives say the business has been intentionally overcharging the county for services not provided, according to Ward. A search warrant was served on the business March 31. Several employees were interviewed but no one was arrested at that time. Business records were seized and are being checked.

Smith Manor has been in business in Madera for 12 years and has held the county contract since 2004. The company was responsible for the transportation, storage, autopsy facilities and dispositions of deceased persons in the county. That will no longer be the case, said Sheriff Jay Varney; Merced County and Jay’s Chapel in Madera will help Madera County cover its coroner’s responsibilities, which is a division of the sheriff’s office.

Varney said the doctor who performs the autopsies is not in question.

No one was answering the phone at Smith Manor on Thursday afternoon, and a knock at the door of the mortuary was not answered. It was not immediately known if there are any upcoming funerals under Smith Manor’s direction affected by Sharlane Smith’s arrest.

Varney called the case “particularly troubling due to the blatant theft and violation of trust” by Smith Manor, “as well as how long they were able to continue this deception despite monthly review of the billings by staff members.”

“We will be reviewing this process and implementing safeguards to prevent future abuse of this kind.”

Varney said Smith was arrested about noon Thursday on 25 counts related to fraud and theft. Her bail was set at $125,000 and she bailed out of jail Thursday afternoon. Her next court date was not known Thursday evening.

Varney said no other criminal charges are anticipated, and that detectives also interviewed co-owner George Smith, Sharlane’s ex-husband.

Over the last four years, Varney estimated, the county has lost $110,000 as a result of Smith’s alleged actions. Varney said the total could be much more when detectives investigate further.

Varney said discrepancies in billings were noticed about four weeks ago. Varney, who succeeded longtime Sheriff John Anderson in January, said, “When you have someone new come into office, you do your due diligence to try to review how things are being done and this is just one of the things that came up in that review.”

The sheriff said an internal audit would have easily caught the problem. He wasn’t sure when the last formal audit of the sheriff’s office occurred. Varney noted that the county auditor-controller’s office had failed to keep up with audits over the last several years, but said the office’s new auditor-controller, Todd Miller, has been working to clean that up.

Varney said Smith Manor’s monthly charges ranged between $20,000 and $40,000. Varney said the criminal investigation of Smith is limited to the past four years. He said that if earlier overcharges are discovered, his office will share that information with county counsel in hopes a civil suit can be brought.

Varney said in an ideal budget year, he would push for Madera County having its own coroner’s facility like neighboring Merced and Fresno counties. He said he expects the temporary use of facilities could last at least through the end of the year as his office searches for a permanent solution.

Smith Manor has been in the news recently: A Madera family sued the funeral home in January 2014 claiming that it disfigured the body of their loved one and prepared the wrong body for viewing in front of other family and friends.

Smith was named in the lawsuit. The funeral home said there was only one mix-up — when the wrong body was displayed. Otherwise, the chapel said it helped the family carry out the funeral arrangements, including a church service and burial in Los Angeles County, and even returned the $7,500 cost of the funeral.