RALEIGH - The panel that oversees funeral homes and crematoriums in North Carolina on Tuesday urged the industry not to collect payments from body parts brokers, but members acknowledged state law gives them no power to stop the practice.

There are no state laws barring funeral homes from collecting a fee for referring potential donors to tissue brokers and no laws requiring that such a deal be disclosed to families of the deceased, North Carolina Board of Funeral Service executive director Paul Harris said at the board's monthly meeting.

Still, the board will urge funeral businesses to reject future kickback arrangements, board president Jack Briggs said.

"We need to do everything in our scope to assure the public that if their mother or father is coming into one of our preparation rooms" that the body will be treated with dignity, said Briggs, president of more than a half-dozen funeral homes in central North Carolina.

The board's discussion came in response to the recent federal shutdown of a Raleigh business that dealt in human tissues.

The case involving Donor Referral Services and owner Philip Joe Guyett Jr. has caused families to ask funeral homes whether their loved one's remains were taken without permission, said P. Mark Blake, the board's secretary and a funeral director at Bryan-Lee Funeral Homes in Raleigh.

The state board regulates about 740 funeral homes and 75 crematoriums in North Carolina.

The U.S. Food and Drug Administration ordered Guyett to close his business earlier this month, after inspectors found his collection practices endangered the health of potential transplant recipients.

The FDA's order said Guyett altered documents on the health history and age of at least five dead donors, eliminating mention of factors such as cancer and drug use that might have made the body parts ineligible for transplant.

The case also revealed that Guyett paid the Raleigh-based Cremation Society of the Carolinas to allow him to harvest tissues from cadavers being prepared for cremation.

Larry Parker, president of the crematorium, has said Guyett paid him $1,000 for each of the roughly 60 donors the funeral home referred.

Harris said he has spoken to Guyett and Parker and that both confirmed their deal; he said Guyett claimed Parker was the only funeral director with whom he had a financial arrangement.

Harris said the men stated that families had given permission for the tissue donation.

But Parker has said Guyett did his harvesting in the home's embalming room, which is not sterile. Tissue must be processed under sterile conditions to avoid spreading infection to recipients.