Federal Trade Commission ‘Funeral
Law’ conducts Undercover Investigations
The ‘Funeral Law’ is a federal
law that protects consumers. The Funeral Industry needed to be governed
by trade laws just like any other retail industry, as funeral homes can
take advantage of consumers and exploit them. Grieving families who don't
know their legal rights are vulnerable to sales pressure, manipulation,
and overspending when it comes time to plan a funeral. Funeral homes
were soliciting business, coercing clients to purchase expensive caskets,
adding unnecessary or unwanted ancillary costs to funeral services.
This resulted in the ‘Funeral Law’ being introduced in 1984, and all licensed
funeral homes must comply with the federal ‘funeral law’.
The Federal Trade Commission
has continued to conduct impromptu surveys on funeral homes to monitor
compliance of the FTC Funeral Law. A series of sweeps by ‘mystery
funeral shoppers’, volunteers from AARP (American Association of Retired
People), identifies funeral businesses that are violating the law.
The FTC recently announced
the results from their 2009 undercover investigations, or sweeps, in nine
states and the District of Columbia.
of the FTC consumer protection rules were discovered in 30% of funeral
homes they visited. This shows an increase in funeral law violations
since the overall percentage of 15% in 1996.
The most abused violation
was to not provide a General Price List to consumers. Violations
are punishable by fines of up to $11,000 per violation. Alternatively,
funeral homes can enroll in the Funeral Rule Offenders Program (FROP) that
was set up by the FTC and the National Funeral Directors Association in
FROP is a five-year program
open ONLY to Funeral Rule violators in which the funeral homes concerned
contribute a fee to the U.S. Treasury in lieu of civil penalties.
This fee is calculated at 0.8% of their average gross income over the last
three years, but the benefit is that it keeps their violation effectively
concealed from the public’s knowledge. The offending funeral homes
agree to making the FROP contribution and participating in the five-year
funeral-training program coordinated by NFDA.
Although FROP can be seen
as a positive step towards improving compliance of the Funeral Law, it
does seem to serve to provide a ‘loop-hole’ for offending funeral homes
to avoid public prosecution.
Important Tips for Consumers
Consumers planning funerals
can better protect themselves and their families from unnecessary and unexpected
expenses by taking several steps:
• Ensure funeral plans are
discussed in advance, allowing time to compare prices and service for individual
items and packages.
• Call funeral homes to
ask about prices and compare their services.
• Ensure you are provided
with an itemized statement of the goods and services you have selected
(this mandatory document must disclose the specific state law that requires
the purchase of any item the customer did not select.)
• Understand that a casket
is not required for a direct cremation, where there is no viewing of the
body, and that it is illegal for a funeral home to tell consumers otherwise.
• Be fully aware that you
can purchase a casket at some place other than the funeral home, often
for a lower price. The Funeral Rule prohibits funeral homes from refusing
to handle the casket and from charging a fee for doing so.
Flowers | Caskets | Funeral
Homes | Cremation Costs |
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