FTC warns funeral homes: Stop misleading grieving customers on pricing
FILE - A white casket is pictured in a funeral home in 2021 (Photo by Ben Hasty/MediaNews Group/Reading Eagle via Getty Images)
When a loved one dies, the grieving family members and friends are left with making decisions about the funeral – including how much it costs.
But funeral homes across the U.S. don’t always provide accurate pricing information, with some even failing to give out pricing information entirely, according to the Federal Trade Commission.
The U.S. government agency said it sent warning letters to 39 funeral homes after FTC investigators conducted an "undercover phone sweep." During the investigation, the FTC said it found several violations of its Funeral Rule – which was designed to help consumers avoid being taken advantage of during such a challenging time, like planning a funeral.
Funeral directors must give consumer price information on the telephone if they ask for it, according to the FTC rule. With some exceptions, they also have the right to choose the funeral goods and services they want, and funeral providers must state this right on the general price list, the agency says.
"Telephone inquiries are particularly important for people who are grieving a loss or making arrangements for a loved one in a different city," the FTC said in a blog post about its investigation. "That’s why the Funeral Rule requires funeral homes to provide accurate price information over the phone.
Throughout all of last year, FTC investigators placed undercover calls to more than 250 funeral homes across all U.S. regions to try and get price information. The agency determined that 39 funeral homes violated the Funeral Rule on these calls.
FTC: Many funeral homes provided inconsistent pricing information
In 38 of the calls placed by undercover FTC investigators, funeral homes either refused to answer questions about pricing at all or provided inconsistent pricing for identical services, the agency said.
During one of those calls, the funeral home also "misrepresented" that the local health code required a body to be embalmed if more than a certain number of people wanted to view the remains. In reality, it was not actually required by the local health code, the FTC said.
Most states do not require a body to be embalmed, which is the process to preserve a body after death. The few states that require embalming only do so in limited circumstances, such as if refrigeration is not available, the agency noted.
On a separate call, the funeral home promised to send a general price list, "which is required to include important disclosures and itemized services," but instead sent a list of "package prices" that didn’t meet the FTC’s requirements, the agency said.
Click here for a list of funeral homes who were sent warning letters by the FTC.
The agency said failure to comply with the Funeral Rule can result in penalties of up to $51,744 per violation.
Push require funeral homes to post prices online
The Funeral Rule was established in 1984, before the internet age, and only applies in-person or by phone.
Over the past few years, there has been a push to update and modernize the rule, requiring funeral homes to also provide pricing information online or via email.
"People are at their most vulnerable when they’re grieving," FTC Chair Lina M. Khan said in a 2022 statement. "Even though Americans today typically begin their shopping online, funeral providers are not required to list prices on their websites."
Khan previously said just under 25% of funeral home websites provided a full list of prices, and over 60% "provided little to no price information whatsoever."
"Stories persist about consumers spending hours trying to answer the most basic questions about how much it will cost to bury their loved ones," Khan said.
"In the internet era, it’s hard to see why anyone should have to physically visit or call multiple funeral homes just to compare prices," the FTC chair added.
The FTC previously accepted public comments on updating the rule. In a statement, the agency told FOX Television Stations that it didn’t have an update "just yet," and that developments are "still in progress."
This story was reported from Cincinnati.