Markets Wired

The Federal Trade Commission has charged a funeral home with violating the FTC’s Funeral Rule, which helps people compare prices and buy only the funeral services and goods they want. The case is part of the FTC’s continuing efforts to make sure consumers are treated fairly when arranging a funeral. It is the second FTC enforcement action against a funeral home that has allegedly committed Funeral Rule violations after being given an opportunity to take compliance training to resolve prior price disclosure citations.

The government seeks $80,000 in civil penalties from Harrison Funeral Home Inc. in Harrison, New York, and its owner, John Balsamo. On two occasions, the defendants allegedly failed to provide an itemized price list at the start of an in-person discussion of funeral arrangements, and a casket price list before showing caskets, as the Funeral Rule requires. According to the FTC’s complaint, the defendants also violated the Rule by failing to provide an outer burial container price list before showing any outer burial containers.

The FTC conducts undercover inspections across the country every year to ensure that funeral homes are complying with the Funeral Rule. First-time offenders cited for such significant violations are offered a chance to enter the Funeral Rule Offenders Program (FROP), a three-year training program designed to increase compliance, as an alternative to possible legal action, a court order, and civil penalties of up to $16,000 per violation. The FROP program is run by the National Funeral Directors Association and provides participants with a legal review of the price disclosures required by the Funeral Rule, and ongoing training, testing and monitoring of their compliance. Participants must make a voluntary payment to the U.S. Treasury in place of a civil penalty, and pay annual administrative fees to the Association. The defendants are not currently eligible to participate in the FROP program because in 2001, when they were cited for failing to provide price lists as required by the Rule, they agreed to enter the program but never participated.

The Funeral Rule, enacted in 1984, gives consumers important rights when making funeral arrangements. Key provisions of the Rule require funeral homes to provide consumers with an itemized price list at the start of an in-person discussion of funeral arrangements, as well as a casket price list before consumers view any caskets. 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. The Rule requires funeral homes to provide itemized prices so that consumers can compare prices and buy only the goods and services they want.

For more information about the Funeral Rule, read Paying Final Respects: Your Rights When Buying Funeral Goods & Services, Funerals: A Consumer Guide, and Complying with the Funeral Rule.

The Department of Justice filed the complaints on behalf of the Commission in the U.S. District Court for the Southern District of New York on May 10, 2012. The Commission vote to refer the complaints to the DOJ for filing was 5-0.

NOTE: The Commission refers a complaint to the DOJ for filing when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. The complaints are not a finding or ruling that the defendant has actually violated the law. The cases will be decided by the court.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them.  To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357).  The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad.  The FTC’s website provides free information on a variety of consumer topics.  Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.

(Harrison Funeral Home)
(FTC File No. 1123017)