01/06/2006

FTC Sweep in Ohio

FTC Sweep of 12 Columbus Area Funeral Homes Finds 6 Homes In Full Compliance with Consumer Protection Law

The Federal Trade Commission announced the results of a recent sweep of 12 funeral homes in the Columbus, Ohio area, to test compliance with the FTC's Funeral Rule. Six of the funeral homes were found to be in full compliance with the rule.

The FTC's East Central Region office and the Ohio Attorney General's Office test-shopped the funeral homes in July and August as part of the Commission's ongoing nationwide law enforcement program. Under the program, FTC test shoppers visit funeral homes to see if they comply with key requirements of the law, such as providing consumers with an itemized general price list that contains mandatory disclosures, and an itemized price lists for caskets. The Funeral Rule is designed to ensure that consumers receive price lists and are told they can purchase only the goods and services they want or need.

"People should know they are being treated fairly when they make purchasing decisions, and this is especially true when they have to make funeral arrangements," said John Mendenhall, Director of the FTC's East Central Region.

In January 1996, the FTC announced the Funeral Rule Offenders Program (FROP), a joint effort with the National Funeral Directors Association (NFDA), to boost compliance with the Funeral Rule. Under FROP, funeral homes that do not give test shoppers itemized price lists in a prescribed time and manner may choose to enter the FROP program rather than face possible legal action, which could result in an injunction and civil penalties.

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, which includes a review of price lists, compliance training, and follow-up testing and certification.

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

In the Columbus-area sweep, five funeral homes received compliance letters for lesser violations, and one funeral home agreed to enroll in FROP.

The Funeral Rule, promulgated by the FTC in 1984, was revised in 1994. One of its key requirements is that, at the beginning of any discussion of funeral arrangements, goods, services or prices, consumers must receive an itemized general price list for use in comparison shopping and other information, including, for example, the fact that embalming is not necessarily required by law. The FTC's 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, "Funerals: A Consumer Guide," describes consumers' rights and legal requirements. A free FTC handbook for funeral providers, "Complying with the Funeral Rule," is also available.

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).