The operator of a New York City funeral home has agreed to settle a Federal Trade Commission enforcement action charging it with a violation of the Funeral Rule, an FTC consumer protection rule designed to give consumers itemized price information so they can buy only the funeral goods and services they want. This is the FTC's first case against a funeral home that previously participated in a compliance training program instead of facing an enforcement lawsuit.
The FTC's settlement with James Donofrio and his company, Donmaz Ltd., doing business as Blair-Mazzarella Funeral Home is part of the FTC's continuing efforts to make sure consumers have the information they need when arranging a funeral. According to the complaint, on two occasions in 2010, the funeral home failed to provide a casket price list before showing caskets, as required by the Funeral Rule. A previous undercover shop in 2003 had also found Donofrio with significant violations of the Rule.
The FTC conducts undercover inspections of funeral homes around the country every year to ensure that they are complying with the Funeral Rule. First-time offenders found with significant violations are offered the opportunity to enter the Funeral Rule Offenders Program (FROP), a three-year training program designed to increase compliance. The one-time FROP training opportunity is an alternative to an enforcement 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.
After a similar alleged failure in 2003, Donofrio enrolled in the Funeral Rule Offenders Program and received FROP training in how to comply with the Rule.
Under the proposed consent order, the defendants will be prohibited from violating the Funeral Rule, including failing to show a casket price list before showing caskets.
The order imposes a $32,000 civil penalty, all but $7,000 of which will be suspended due to the defendants' inability to pay. The full judgment will become due immediately if the defendants are found to have misrepresented their financial condition.
The Funeral Rule, first issued in 1984, gives consumers important rights when making funeral arrangements. Key provisions of the Rule require funeral homes to provide consumers with a general price list itemizing the prices of the funeral goods and services they offer 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.
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 Commission vote to authorize the staff to refer the complaint to the Department of Justice, and to approve the proposed consent decree, was 3-1, with Commissioner Rosch voting in the negative. The DOJ filed the complaint and proposed consent decree on behalf of the Commission in U.S. District Court for the Eastern District of New York on May 3, 2012. The proposed consent decree is subject to court approval.
NOTE: The Commission authorizes the filing of a complaint 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 complaint is not a finding or ruling that the defendant has actually violated the law. This consent order is for settlement purposes only and does not constitute an admission by the defendant of a law violation. Consent orders have the force of law when signed by the District Court judge.
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