|
Washington Report
January 2000
FTC Funeral Rule Workshop Provides
Insights by the Participants
by Robert M. Fells, Esq., General Counsel
On November 18th, the Federal Trade Commission (FTC) convened a workshop conference at its Washington, D.C., headquarters to discuss the ongoing review of the Funeral Rule. Chaired by Eileen Harrington, FTC associate director for marketing practices, the workshop hosted representatives from 23 organizations, including the ICFA, the National Funeral Directors Association, the Cremation Association of North America, Service Corporation International, the AARP and the Funeral and Memorial Societies of America, among many others. An overflow crowd in attendance required an additional room, where the proceedings were viewed by closed-circuit television.
Following the introductions, the day-long meeting was divided into six sessions that discussed: 1) the definition of the term “funeral provider”; 2) casket handling fees; 3) issues related to prearrangements; 4) required items on the general price list; 5) the non-declinable basic services fee; and 6) a closing segment whereby members of the public made comments.
The ICFA was represented by Paul Elvig, ICFA secretary, chair of the ICFA State Legislation and Association Committee and vice president of administration at Evergreen-Washelli Memorial Park and Funeral Home in Seattle, Washington. Elvig is also a former state cemetery and funeral home regulator and founding president of the North American Cemetery Regulators Association. The ICFA also was represented by Funeral Rule Review Subcommittee Chair Diane Kauffman, Executive Vice President Linda Christenson and General Counsel Bob Fells. During the discussion of whether the Funeral Rule should be expanded to other sellers, Elvig said, “Our review of FTC procedures and records has gone as far as to ask under the disclosure, Freedom of Information Act, for copies of any and all complaints filed against cemeteries. We know the FTC gets approximately 60,000 complaints a year, and we were told in our request for this information that zero complaints have been filed against cemeteries....”
Elvig continued, “So, we’re suggesting—as a matter of fact, we are advocating in a very aggressive way—that if the rule is to be expanded to cover cemeteries, that the FTC follow its own procedures as it pursues an expansion of the rule. And those procedures would be to determine that, in fact, that there is a fact that the public is being dealt with unfairly at the cemetery level. The information we’re hearing around this table are opinions, but we’re not getting at surveys that are detailed, that are accurate and that are qualified....”
When a participant later mistakenly quoted an AARP survey claiming that only 36 percent of consumers received a written price list from cemeteries, Elvig corrected the record by pointing out that the AARP survey found just the opposite: Only 36 percent did not receive a written price list. Another participant suggested that the Funeral Rule was originally enacted due to potential abuses rather than documented cases, but Harrington stated, “No, it would have been that there was an actual record of deceptive and unfair trade practices and that the remedies imposed by the rule are likely to correct those.”
With regard to cemetery complaints, Elvig commented, “We have looked at the complaints that Lisa’s organization (Lisa Carlson, FAMSA) has supplied. We have looked at the complaints that AARP has supplied. And in many, many cases these are anecdotal type of complaints, these are not specific.... The types of complaints we have seen about cemeteries are not to do with disclosures, with prices.... The ability of AARP to collect information from cemeteries demonstrates how available that information really is in the area of having prices disclosed. So, we would submit that the survey work done by Lisa’s organization, by AARP, in both cases do not demonstrate that the consumer is kept in the blind, that the consumer does not have disclosure or that the consumer somehow is forced to deal with a cemetery that they don’t want to deal with. And so we don’t think the record is there.”
Workshop Chair Eileen Harrington placed the various issues in perspective. “I want to note a couple of things. One is that I think Paul (Elvig), actually, made the point that the FTC’s focus here is on presale disclosure. Our statute gives us the authority to act to prohibit deceptive and unfair trade practices, and the focus of the rule is to prohibit the deceptive practices of failing to disclose material information. And so you properly note that there are many other things happening in relation to these transactions that fall outside of the FTC’s statutory mandate, and I think we all agree on that.”
Harrington continued, “The other thing I would note for your consideration is that the rule presently clearly applies to, depending on whose numbers you use, somewhere between 18,000 and 22,000 providers, which is a very large number of businesses.... The FTC has fewer than 1,000 employees. So, the challenge already is that with fewer than 1,000 employees and 18,000 to 22,000 businesses covered, should this rule be expanded to cover an additional number of entities, whether they are third-party casket sellers or monument sellers or cemeteries?”
Commenting on the various consumer issues involved in funeral and burial transactions, Elvig discussed the ICFA Model Guidelines for State Laws and Regulations that were provided to the FTC and, subsequently, to all workshop participants. Elvig said the “27 sets of guidelines on rules and regulations that may be adopted to cover cemeteries, and they cover a wide gamut of issues, (discuss) the issues that we really face as a regulator when we’re dealing with consumer complaints. And so we would invite you to look at those. They’re rather thick and detailed, and they’re good.”
The FTC staff is expected to file a report with the Commission in the spring detailing its findings and making recommendations on how, if at all, the Funeral Rule should be amended. In the event that amendments are proposed, a second round of public comments will be initiated.
All quotes in this column were taken directly from the FTC Workshop transcript, which can be viewed on the Internet by visiting www.ftc.gov, then clicking on the “Consumer Protection” icon and following the prompts to the Funeral Rule Review.
Copyright ICFA 2000.
|
