FROM: U.S. FEDERAL TRADE COMMISSION
Undercover Inspections of Funeral Homes in Six States Prompt Compliance with Funeral Rule Disclosure Requirements
FTC’s Funeral Rule Requires Funeral Homes to Provide Price Lists to Consumers
Investigators working undercover in six states found failures to disclose pricing information to consumers, as required by the Federal Trade Commission’s Funeral Rule, in 27 of the 100 funeral homes they visited during 2014. All but two of the 27 homes have agreed to enter the Funeral Rule Offenders Program (FROP).
The FTC conducts undercover inspections every year to ensure that funeral homes comply with the agency’s Funeral Rule. The Rule, issued in 1984, gives consumers important rights when making funeral arrangements. Key provisions of the Rule require funeral homes to provide consumers with an itemized general price list at the start of an in-person discussion of funeral arrangements, a casket price list before consumers view any caskets, and an outer burial container price list before they view grave liners or vaults. The Rule also prohibits funeral homes from requiring consumers to buy any item, such as a casket, as a condition of obtaining any other funeral good or service. By requiring itemized prices, the Funeral Rule enables consumers to compare prices and buy only the goods and services they want.
Funeral homes with price list disclosure violations can enter a training program designed to increase compliance with the Funeral Rule. This year all the homes found in violation chose to enter the FROP run by the National Funeral Directors Association rather than subject themselves to the possibility of a civil penalty action by the FTC. The FROP provides participants with a legal review of the price disclosures required by the Rule, and on-going training, testing and monitoring for compliance. Funeral homes that participate in the program make a voluntary payment to the U.S. Treasury in place of a civil penalty, and pay annual administrative fees to the Association.
The results of the FTC inspections for price list disclosures by region are as follows:
In Northwest Arkansas, 5 of the 16 funeral homes inspected failed to make a price list disclosure;
In Bakersfield, California, 7 of the 11 funeral homes inspected failed to make a price list disclosure;
In Annapolis, Maryland, and vicinity, 4 of 13 funeral homes inspected failed to make a price list disclosure;
In St. Louis, Missouri, 3 of 16 funeral homes inspected failed to make a price list disclosure;
In Westchester County, New York, 3 of 29 funeral homes inspected failed to make a price list disclosure; and
In Seattle, Washington, 5 of 15 funeral homes inspected failed to make a price list disclosure.
In addition, the FTC identified a number of homes, within the six states, with only minor compliance deficiencies. In such cases, the FTC requires the funeral home to provide evidence that it has corrected the problems.
Since the FROP program began in 1996, the FTC has inspected more than 2,900 funeral homes, and found 503 homes with violations, 486 of which have agreed to enter the FROP program, with the remainder subject to FTC law enforcement actions.