Get two business owners in a room and you’ll get three opinions about how and when to disclose information to prospective buyers. But if you have clients in the funeral industry, the FTC’s Funeral Rule takes some of the guesswork out of that decision.
The Rule is crystal clear that funeral providers must show a printed or typewritten price list to people who ask in person about the kinds of caskets or alternative products that are available or how much they cost. So much for the how. What about the when? The Rule is equally clear that the list has to be offered at the beginning of the discussion – or at the very latest before any caskets are shown. The FTC just filed a lawsuit against Montgomery, Alabama-based Ross-Clayton Funeral Home alleging that on at least two occasions, the funeral home failed to honor that provision.
The filing of the complaint gives us a chance to talk more about an innovative way the FTC and industry work together to uphold the standards mandated by the Funeral Rule. Every so often, the FTC conducts undercover investigations to make sure funeral homes are complying with the Rule. First-time offenders cited for significant violations are offered a unique alternative to law enforcement – and the court orders and hefty civil penalties it may entail. Instead, they can choose to enter the Funeral Rule Offenders Program (FROP), a three-year program run by the National Funeral Directors Association where they get training on Funeral Rule compliance.
FROP participants pay an annual administrative fee to the Association toward the cost of the program and make a voluntary payment to the U.S. Treasury that’s less than what the FTC would have likely asked for for if a case had gone to trial. FROP was an option for the defendants in the Ross-Clayton case, but they opted not to participate. Instead, the matter is pending in federal court.
If you work in the funeral industry or have clients who do, the FTC's Complying with the Funeral Rule offers to-the-point guidance. For other resources – including a video introduction to your legal obligations – bookmark the Business Center’s special page for funeral industry members.