FTC Announces Results of Inspection of Funeral Homes in Nassau County, New York for Compliance with Consumer Protection Law

Staff of the Federal Trade Commission today announced the results of a sweep of 20 funeral homes in Nassau County, New York, to test compliance with the FTC’s Funeral Rule. Seven of those homes appeared to be in violation of the Rule, the agency found.

The FTC’s Northeast Region Office coordinated the sweep as part of an ongoing nationwide law enforcement program. FTC “test shoppers” visited the 20 funeral homes to determine whether they were complying with key provisions of the FTC’s Funeral Rule – requirements that consumers be given a copy of an itemized general price list, and that they be shown itemized price lists for caskets and outer burial containers in a timely manner. The Funeral Rule is designed to ensure that consumers making funeral arrangements receive price lists and are informed that they can buy only the goods and services they want or need.

According to the FTC, six of the funeral homes considered to be in violation of the Rule will be allowed to resolve the possible law violations by participating in the Funeral Rule Offenders Program (FROP), in lieu of possible formal legal action, which could result in an injunction and civil penalties.

The FROP program, announced in January 1996, was developed as a joint effort between the National Funeral Directors Association (NFDA) and the FTC to boost funeral industry compliance with the Funeral Rule. Under the program, funeral homes that fail to give test shoppers the itemized price lists in the time and manner required by the Rule are given the option of entering the FROP program rather than face possible formal legal action. If they choose FROP, they make a voluntary payment to the U.S. Treasury in lieu of civil penalties, and enroll in a program, administered by the NFDA, that includes a review of price lists, compliance training and follow-up testing and certification.

Depending on the severity of the violation, funeral homes considered to be in violation of the Rule may be allowed to resolve law violations through means other than the FROP program or formal law enforcement action that could result in an injunction and civil penalties. Among those alternative means of resolving possible violations, a funeral home may receive a letter notifying it that it is not in compliance with the Rule and warning that future noncompliance could result in a monetary penalty. In this instance, the seventh funeral home that appeared to be in violation received such a warning letter.

The Funeral Rule, developed by the Commission in 1984, was revised in 1994. One of its key requirements is that funeral homes must give consumers a copy of an itemized general price list, which they can use for comparison shopping at the beginning of any discussion regarding funeral arrangements, goods, services, or prices. The general price list must contain a number of disclosures and other information including, for example, that embalming is not necessarily required by law. The Rule also makes clear that consumers do not have to buy a package funeral, but instead, may pick and choose the goods and services they want.

A free FTC brochure for consumers titled, “Funerals: A Consumer Guide,” provides additional information about consumers’ rights and legal requirements when planning funerals. A free FTC handbook titled, “Complying with the Funeral Rule,” provides information to funeral providers on complying with the Rule.

Copies of the FTC brochure and other documents pertaining to the FROP program are available from the FTC’s Web site at http://www.ftc.gov and also from the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580 or call toll-free: 1-877-FTC-HELP (1-877-382-4357).