FTC: Stop Funeral Giant From Getting Bigger

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Consumer Group Opposes Merger of Funeral Chain Giants 

July 11, 2013 FOR IMMEDIATE RELEASE

Contact: Josh Slocum,
Executive Director
802-865-8300
 
This e-mail address is being protected from spambots. You need JavaScript enabled to view it

South Burlington, VT.—Funeral Consumers Alliance, the only national nonprofit protecting the rights of funeral consumers, urges the Federal Trade Commission to deny the merger of funeral giants Service Corporation International (SCI) and Stewart Enterprises (STEI). If they combine, SCI will amass more than 2,000 funeral homes and cemeteries from coast to coast, and will be vastly larger than any other funeral home and cemetery chain.

Unlike many other retail chains, bigger isn’t better when it comes to funerals. Unlike Wal-Mart or Costco, SCI’s savings from economies of scale don’t get passed on to the customer family. They go to the company’s true customer, the shareholder.

“It’s alarming to think that a company with a long track record of abusing consumers at the worst times of their lives might get even bigger,” said Josh Slocum, FCA’s executive director. “For at least 15 years grieving families around the country have complained to us about the practices at SCI funeral homes and cemeteries. From lying about options in order to boost the funeral bill, to digging up graves to re-sell them to another unsuspecting family, to denying the legal rights of LGBT people to make funeral arrangements for their partners. You name it, we’ve heard it.”

“SCI has devoured the other funeral home chains over the past several years and now is the king of the hill in most major metropolitan markets. And the results have not been good for consumers. These mergers have led to higher prices and deteriorating service,” Slocum said.

Most people don’t even know they’re doing business with a multinational Wall Street chain when they call their local funeral home. “Smith and Sons Funeral Home” may not have anything to do with the Smith family at all. Only SCI’s consumer-friendly brand-name, Dignity Memorial, gives a clue to the ownership. Price surveys by Funeral Consumers Alliance groups have long documented how Dignity-owned businesses are among the most expensive in any region you look.

“Dignity Memorial” is no stranger to scandal: 

Funeral Consumers Alliance has collected hundreds of complaints from families around the country. These families report SCI funeral homes and cemeteries have violated federal regulations protecting grieving consumers from funeral fraud, that strangers are found buried in graves families bought decades before, and that aggressive salespeople (SCI calls them “family service counselors”) have lied about non-existent government regulations so consumers would be forced to buy expensive burial services they didn’t want.

Funeral Consumers Alliance reminds the Federal Trade Commission that funeral purchases are unlike any other in their potential to harm the customer. Families buying funeral and cemetery services are incredibly vulnerable and have been subject to deceitful and egregious conduct. Indeed, the FTC’s own “Funeral Rule,” enacted in 1984, was a response to the overwhelming record of routine deception and consumer abuse across the funeral industry.

“This is not a run of the mill merger; this isn’t about whether a $20 retail product will cost consumers $5 more,” Slocum said. “We’re talking real money here. Funeral consumers often make great economic sacrifices to bury their loved ones. The average full-service funeral runs in excess of $7,000 and often for much more at SCI’s Dignity locations. Especially when it has faced less competition, SCI has increased prices and we can expect more of the same if this merger occurs. Given the lack of knowledge about funeral options and the stress of grief, we can’t just say a ‘rational consumer’ will vote with their dollars and choose another funeral home. That’s not how the unique funeral transaction works, and that reality is why the FTC specifically regulates
funeral homes.”


Contact:
Josh Slocum, Executive Director
802-865-8300
 
This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Last Updated ( Tuesday, 15 October 2013 10:51 )  
Comments (5)
1 Tuesday, 13 August 2013 18:19
judith leader
will the f.t.c. allow this merger to go through. i thought there was a monopoly in this country. after reading what you wrote above, what are the chances that this will go through. from what i am hearing it is set to close the early part of 2014 or the every end of this year.

what is your opiinion
2 Wednesday, 14 August 2013 10:25
Anonymous
I live in Houston, TX. I am pre-planning for my father who has a few weeks to months left. I stopped in at Dignity location. I was told that the July special is a $12,000 for $8,000 for a traditional funeral. How can that be? When looking over the not so informative flyer I was given, There is nothing special about it when I compared to other funeral homes.. Can only imagine if they get bigger!!
3 Wednesday, 14 August 2013 14:26
Josh Slocum, Exec. Director FCA
Hi Judith,

Well, no one can predict what the FTC will do, but most mergers do go through. But not usually wholesale---many times companies are required to sell off some of the locations in certain markets where they'd have a local monopoly.

Anyone who says they know when this deal is going to go through, or that they know it's going to go through, isn't being truthful.
4 Monday, 26 August 2013 14:42
judith wall
big deal if they sell off some of their funeral homes and cemeteries. it still leaves them as an monopoly in this industry. you know that they will sell of the least profitable of their funeral homes and cemeteries.

they cannot allow the merger of airlines, but this is o.k. if this goes through it is an obscene case of justice gone completely wrong. what does someone have to do to stop this miscarriage of justice.

there will be no way an independent funeral home operator can compete with them and their prices. that is what they want. then they swoop in and buy up your funeral home that has been in families for years.

this stinks.
5 Thursday, 24 October 2013 19:58
Miguel Legaspi
KEEEEEP GOING DIGNITY! Us small guys LOOOOVE what your doing. Better for us, the bigger the better. All we have to do is under market our funeral and cremation services just a little to take your business. I am amazed how totally unprofessional and unethical a corporation can be and STILL turn a profit. No problem, all I have to do is "WALK" up the hill......... No running here.

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