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ICFA Blasts CBS

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FCA responds to the International Cemetery and Funeral Association

Following a two-part broadcast on CBS February 11 and 10 on funeral fraud ,the National Funeral Directors Association and the International Cemetery and Funeral Association sent CBS letters of protest. Both accused the network of airing sensationalist stories of funeral fraud, stories taken out of context.

The February 10 CBS Evening News broadcast did feature a guest who dispensed the absurd "consumer advice" that customers should check a funeral home's toilet paper to assess the overall service quality. In addition, the piece could have been done less heavy-handedly.
FCA executive director Joshua Slocum appeared live on CBS' Early Show February 11 to talk briefly with Harry Smith on how consumers can protect themselves while shopping for a funeral.
ICFA responded immediately to these segments in their typical fashion. You might call their approach "accentuate the positive, eliminate the negative."
FCA sent a letter below  response, then  ICFA sent us a letter of rebuttal on February 25. All three letters are below, in chronological order.

 

February 11, 2004 

Mr. Leslie Moonves
Chairman, President and CEO
The CBS Television Network
51 W. 52nd Street
New York, NY 10019

Re: 2/10 CBS Evening News Broadcast,
"When Death Knocks, Bereaved Beware"

Dear Mr. Moonves:

The Tuesday, February 10th broadcast of CBS Evening News with Dan Rather contained a segment warning your viewers about funeral scams, especially the preservative claims of so-called "sealer caskets." We agree that if there is one thing all consumers should remember in making funeral arrangements, it would be that human remains cannot be preserved for any extended length of time. A "red flag" should immediately be raised when any seller claims to have a product or service that will preserve human remains over the long term. However, CBS represented as "news" the experience of a consumer, Barbara Osborne, who had already persuasively testified to her experience almost two years ago before a U.S. Senate subcommittee in April 2002. While the passage of time does not make her experience any less heartbreaking, it does remain a singular event that CBS News failed to place into any context such as the fact that there are over 5,000 funerals and burials in the United States each day.

Indeed, the segment's opening claim that "there are many horror stories" in the funeral industry suggests that fairness was not a priority in the report, so let's look at the record. Consumers have filed almost 550 complaints with the Federal Trade Commission (FTC) against funeral-related businesses during a 29 month period between 2001 and 2003 for an average of about 19 complaints per month compared to about 167,000 funerals per month. This results in the statistically negligible complaint rate of one-hundredth of one percent. Regardless, funeral-related complaints are emotional in nature and we do not trivialize them. It is significant to note that none of the FTC complaints involved "sealer caskets."1 Many complaints dealt with the failure of funeral homes to provide written price lists, an issue that the CBS News segment dramatically illustrated by use of an undercover camera at three Washington, D.C. area funeral homes. Ironically, the national headquarters of the FTC that enforces the price disclosure requirements of the Funeral Rule is located on Constitution Avenue, probably not more than a mile or two from these funeral homes. CBS is no doubt aware of this proximity, which leads to an interesting question: Is CBS News concerned with helping consumers or just frightening them?

A related report on this morning's The Early Show featured a consumer advocate urging consumers to shop in advance of need, to obtain a copy of the price list upon entering a funeral home, to leave if they don't get one, and to bring along a friend who may be less emotionally involved in the transaction. We concur with this advice but were disappointed when the advocate repeated the flawed "wisdom" about preplanning "but not prepaying." Similar to all consumer purchases, prepaying for a funeral well before it is needed has advantages and risks that can be evaluated prior to payment. We believe it is more helpful to warn that prefunding is not for everyone, but telling consumers never to prepay and to instead save for their funeral expenses on their own can be the most hazardous plan of all.

The overwhelming majority of prepaid funerals are performed as intended, and many have price guarantees that are written into the contract. These funds are also protected from creditors of both the consumer and of the funeral home. Prepayment is recommended when consumers must "spend down" their assets to qualify for government assistance. However, funds privately saved by consumers in bank accounts or certificates of deposits are not generally shielded from creditors' claims. The loss of these funds prior to the funeral most commonly occurs due to the expenses of the final illness including services not covered by insurance or by insurance co-pay obligations. To the best of our knowledge, nobody can advise consumers on how to pay for a funeral after their savings have been depleted. Prepayment can and does work.

Finally, there are an increasing number of funeral and burial information resources for consumers to consult that are easily accessible through the Internet. We urge consumers to check several different web sites to neutralize the "private agendas" common to many sites both from the industry and its critics. Among the sites, we urge consumers to visit our association's Consumer Resources section at www.icfa.org that we believe offers the most comprehensive information of all in a user-friendly Question-and-Answer format. Best of all, no salesman will call.

Very truly yours,

Robert M. Fells
External Chief Operating Officer
and General Counsel


1 Two casket retailers questioned whether the term "sealer casket" is prohibited by law, but there were no consumer complaints involving the product. *********************************************************************************************
 

February 19, 2004

 

Robert M. Fells Chief External Operating Officer and General Counsel
International Cemetery and Funeral Association
1895 Preston White Drive, Suite 220
Reston, VA 20191

Dear Mr. Fells,

As you know, the February 10 and 11 CBS News segments relating to consumer problems in the funeral industry provoked consternation among funeral service's two largest trade associations.

I concur with some of the criticisms leveled at the network. Yet I'm troubled by some statements contained in your February 11 response to CBS. These statements continue ICFA's pattern of downplaying very real problems in the funeral and death services industries.

Clearly, Ed Markin's advice to consumers to check the thickness of a funeral home's toilet paper in order to assess the business's quality of service was ludicrous. CBS News did its viewers no service, nor did it burnish its image as a network of serious journalists, in airing this laughable piece of "advice."

The segment did, however, touch upon serious and substantive consumer issues. The problem was not so much what CBS chose to air, but what it did not. As you have no doubt experienced, television news is produced at a frenetic pace that often precludes in-depth discussion.

As the unnamed consumer advocate to whom you referred in your letter, I was disappointed that I was unable to elaborate on the benefits and dangers of prepaying for funerals during my February 11 appearance on the CBS Early Show. But warning consumers of the risks of funeral prepayment, as I did, was hardly "flawed 'wisdom.'" With so many players in the funeral field wooing consumers into unfair, usurious, and expensive prepaid contracts, it was vital that I offer a counterpoint.

While you rightly asserted in your letter to CBS that consumers facing Medicaid "spend-downs" may shelter funeral funds through prepaid contracts, you glossed over the egregious problems endemic to "preneed" nationally. I found it disingenuous — to put it kindly — for you to sum up your argument with the statement, "Prepayment can and does work."

Surely you are aware of the tangle of confusing and unfair preneed statutes and regulations existing among the 50 states. Does prepayment "work" for all Indiana consumers when it automatically becomes irrevocable 30 days after purchase? Does prepayment "work" for Florida consumers who can lose two-thirds of their investment when they decide to back out of a contract for fear their graves have been resold? Does prepayment "work" for families in Pennsylvania, where the Commonwealth Court recently ruled that preneed sellers do not have to transfer the customer's funds if the family moves?

Expanding on the theme of ICFA's January 6, 2004, report on funeral-related complaints at the Federal Trade Commission, you wrote to CBS that the number of complaints against funeral-related businesses lodged with the FTC in a 29-month period amounted to a mere 1/100th of one - percent of all complaints received. While this number may indeed be "statistically negligible," your argument takes no account of the widespread consumer ignorance of the Funeral Rule and state regulatory protections of which consumers may take advantage. How else can we explain the dearth of complaints to the FTC in light of the Funeral Rule violations FCA groups document nationwide?

ICFA's January 6, 2004 report — part of a transparent attempt to derail plans to expand and codify the Funeral Rule — stated:

". . . the complaint tabulation establishes that consumers will file complaints when they believe they have been treated unfairly by industry members, contrary to assertions by industry critics that 'consumers don't complain.'"

I assume Funeral Consumers Alliance is among those unnamed "industry critics." As FCA's executive director, I assure you that far fewer consumers actually complain to the FTC than the number who have a right to do so. Daily correspondence and telephone calls arrive at my office from citizens who relate deceptive practices in the funeral transaction, only to say they had no idea the Funeral Rule existed, or that any regulatory board existed in their state.

The January 6 ICFA report also states:

"The new tabulation confirms, however, ICFA's long-held position that consumers experience only isolated incidents of potential funeral rule violations by sellers such as cemeteries that are not covered by the rule."

Taking these two statements together, ICFA seems to be making an argument that goes like this: If a tree falls in the forest and no one reports it, then the tree never fell.

A recent survey by the Funeral Consumers Alliance of Central Ohio found that among 19 Columbus funeral homes, none of their General Price Lists complied with the Funeral Rule. Eight funeral homes, for example, failed to offer FTC-mandated service options or the prices for these.

Assume that each of these 19 funeral homes performed a conservative 50 services in 2003, and that each customer was given the same General Price List we collected for our survey. By my calculations, this results in 950 potential consumer complaints — almost double the number ICFA found in the Federal Trade Commission's nationwide files.

Does this mean that simply because these consumers didn't "believe" (or didn't know) they were mistreated, that the mistreatment didn't occur? This example comes from but one mid-sized American city — could anyone credibly claim that problems in the funeral industry come from "a few bad apples?"

Of course, consumer groups and industry associations will not see eye-to-eye on every matter. I would hope, though, that we all have the consumer's best interests in mind. While FCA does not agree with all the policy decisions made by NFDA, the organization did have the courage to plainly acknowledge the widespread problems with preneed in no fewer than three editorials last year in its magazine, The Director.

ICFA, by contrast, continues to ignore, obfuscate, and rationalize away the troubles plaguing the funeral transaction. This reflects very poorly indeed on its members and constituency. I urge ICFA to abandon its efforts to stall increased consumer protection, and to instead join with like-minded organizations to promote fair and honest business practices that benefit the consumer and the industry alike.

Sincerely,

Joshua Slocum
Executive Director
Funeral Consumers Alliance
33 Patchen Road
South Burlington, VT 05403

cc:
Leslie Moonves, Chairman, President and CEO, CBS
The Honorable Christopher J. Dodd, U.S. Senator
The Honorable Mark Foley, U.S. Representative
Carole Danielson, Funeral Rule Coordinator, Federal Trade Commission
Allen Hile, Division of Marketing Practices, Federal Trade Commission
Christine Pepper, CEO, National Funeral Directors Association
Susan Simon, Editor, Funeral Monitor
Ron Hast, Editor and Publisher, Mortuary Management
Doug Hernan, Editor and Publisher, Funeral Service Insider
Edward J. Defort, Editor, American Funeral Director
Jim Miller, Editor and Publisher, Savvy Senior

 


February 25, 2004

 

Mr. Joshua Slocum
Executive Director
Funeral Consumer Alliance
33 Patchen Road
South Burlington, VT 05403

Dear Mr. Slocum:

We have received your letter, dated February 19, 2004, which was written in response to ours, dated February 11, 2004, to Mr. Moonves, CBS Television Network. We agree that television news reporting lacks nuance but your letter provides a good example of the ICFA's ongoing concerns over how consumer protection issues are mischaracterized.

The main thrust of your letter takes issue with our reporting on the relatively low number of funeral-related consumer complaints received by the Federal Trade Commission during the 29-month period between 2001 and 2003. We do not claim or imply that the number constitutes the entire universe of consumer complaints in the United States. However, instead of providing additional statistical data, you indulge in sheer speculation, to quote: "Assume each of these 19 funeral homes performed a conservative 50 services in 2003, and that each customer was given the same General Price List we collected for our survey. By my calculations, this results in 950 potential consumer complaints - almost double the number ICFA found in the Federal Trade Commission's nationwide files." Well, Mr. Slocum, as long as you're just speculating, why stop at 950? Why not make it 9,950? You see my point: the ICFA is attempting to quantify documented complaints from a federal agency while you rely on your imagination for the data.

Like yourself, we receive daily phone calls and correspondence from consumers with inquiries and complaints through our volunteer complaint-resolution arm, the Cemetery Consumer Service Council. However, at the end of each year we tally up our data and circulate it to federal agencies, state consumer protection offices, the Better Business Bureaus, and the media. Through industry volunteers, not only from the ICFA but from other trade associations as well, we are able to resolve many of these problems. In fact, the only complaints where we cannot assist are the ones we don't hear about. As a result, we would welcome a cooperative effort with FCA to assist with consumer complaints that you are receiving.

The wisdom of prefunding is very much a sore point with your organization and we definitely would want to pursue this issue if you are so inclined. The ICFA has consistently cautioned that prepayment is not for everybody, but in this country where many people don't even save for their retirement years, is it wise to assume that people will save for their funerals? Even the FTC encourages consumers to purchase the cemetery property of their choice well in advance of need. However, the blanket condemnation of prefunding is a disservice to consumers who wish to prudently plan for their final expenses.

Another aspect of your letter concerns "the tangle of confusing and unfair preneed statutes existing among the 50 states" and that many consumers seem unaware of the FTC Funeral Rule and state regulatory protections. You ask, "How else can we explain the dearth of complaints to the FTC...?" One plausible explanation was provided recently by the U.S. General Accounting Office (GAO), the investigative arm of Congress. In September 2003, the GAO published a report on state funeral and burial laws observing, "It must be noted that a low number of enforcement actions taken by a state may not be indicative of lax enforcement efforts, but rather could be reflective of a general lack of problems involving the death care industry in that state." The point is that we need more documentation, not "the sky is falling" speculation.

It is regrettable that you chose to end your letter by making inflammatory accusations that ICFA "continues to ignore, obfuscate, and rationalize away the troubles plaguing the funeral transaction. This reflects very poorly indeed on its members and constituency." You are evidently unaware that since 1998 the ICFA has published a series of Model Guidelines for State Laws and Regulations, which currently number twenty-eight. These guidelines cover such topics as prepaid contract trust funds, insurance-funded prearrangements, authorization to control final disposition, handling of remains in conjunction with the cremation process, solicitation, consumer guarantee funds, and written price disclosures prior to purchasing, among many others. We provided a copy of the guidelines to your predecessor, Mrs. Carlson, and we assume it remains the property of FCA. We were also contacted by one of your board members who wished to purchase a copy of the Model Guidelines but we provided this material without charge as a professional courtesy. It is interesting to note that Senator Chris Dodd and Representative Mark Foley incorporated much of the language of our model guideline on prepaid contract disclosures in the legislation they introduced into Congress in November 2002. Contrary to your assertions, we believe the Model Guidelines for State Laws and Regulations reflect very responsibly on ICFA's members and constituency.

The ICFA does not fear new laws, but we are very concerned with bad laws, especially "laws by anecdote." These are proposals made in response to isolated events that serve neither consumers nor the industry. We seem to share a mutual concern that some states require stronger laws and better enforcement, two goals that led to the creation of the ICFA model guidelines project in the first place. We also want to see more uniformity among state laws, but the mere fact that laws differ from state to state is not in itself necessarily a "red flag," a point made in the GAO report.

In closing, if your letter was meant to initiate a dialogue between our two organizations, then we welcome the opportunity to meet with you and discuss issues of mutual concern, paramount among which is consumer education.

Very truly yours,

Robert M. Fells
External Chief Operating Officer
and General Counsel


cc:
Leslie Moonves, Chairman, President and CEO, CBS
The Honorable Christopher J. Dodd, U.S. Senator
The Honorable Mark Foley, U.S. Representative
Carole Danielson, Funeral Rule Coordinator, Federal Trade Commission
Allen Hile, Division of Marketing Practices, Federal Trade Commission
Christine Pepper, CEO, National Funeral Directors Association
Sue Simon, Editor, Funeral Monitor
Ron Hast, Editor and Publisher, Mortuary Management
Doug Hernan, Editor and Publisher, Funeral Service Insider
Edward J. Defort, Editor, American Funeral Director
Jim Miller, Editor and Publisher, Savvy Senior
*********************************************************************************************

 

 

 

FTC "Sweeps" NYC Metro Funeral Homes

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Funeral Rule Violators

The Federal Trade Commission announced the results of a "sweep" of metropolitan New York City homes on December 29, 2003. The FTC press release stated that 12 of 29 funeral homes were found by test shoppers to have violated the Funeral Rule. From the paperwork we obtained from the FTC through a Freedom of Information Act (FOIA) request, it appears these violators either didn't produce the required price lists, or didn't offer them at the required time.

FTC test shoppers visited these funeral homes twice. Among the violators, many were found to break the rules on both visits. Others were caught violating the rules on only one occasion.

While the FTC has promised not to release the names of Funeral Rule violators to the press when the violators enter the Funeral Rule Offender Program ("FROP", run by the National Funeral Directors Association - more on this to come), these names are public record and we release them as soon as the FTC responds to our FOIA requests.

Below are the violators found during the fall, 2003 "sweep." For each, we've noted the violation(s) found on each visit, and the remedial actions taken. See the bottom of this page for a key to abbreviations.


Baker Funeral Service, Bridgeport, CT

Violations, 1st visit

  • No CPL
  • No OBCPL

Violations, 2nd visit
  • No violations
Remedial Action: FTC sent letter asking for Funeral Rule compliance

Blair Mazzarella Funeral Home, Brooklyn, NY

Violations, 1st visit
  • Late GPL
  • Late CPL

Violations, 2nd visit
  • Late GPL
  • No CPL
  • No OBCPL
Remedial Action: Entered FROP

Daniel George Funeral Home, Brooklyn, NY

Violations, 1st visit
  • No CPL
  • No OBCPL

Violations, 2nd visit
  • No CPL
  • No OBCPL
Remedial Action: FTC offered option of entering FROP

Dougiello Funeral Home, Bridgeport, CT

Violations, 1st visit
  • No GPL

Violations, 2nd visit
  • No GPL
  • No CPL
Remedial Action: Entered FROP

English Brothers Funeral Home, Brooklyn, NY

Violations, 1st visit
  • No GPL

Violations, 2nd visit
  • No significant violations
Remedial Action: FTC sent letter asking for Funeral Rule compliance

George Peterson Funeral Home, Bridgeport, CT

Violations, 1st visit
  • No CPL

Violations, 2nd visit
  • No CPL
Remedial Action: Entered FROP

Green Funeral Home, Fairfield, CT

Violations, 1st visit
  • No CPL
  • No OBCPL

Violations, 2nd visit
  • No GPL
Remedial Action: Entered FROP

Guido Funeral Home, Brooklyn, NY

Violations, 1st visit
  • No GPL

Violations, 2nd visit
  • No violations
Remedial Action: FTC sent letter asking for Funeral Rule compliance
LaBella Funeral Chapel, Brooklyn, NY

Violations, 1st visit
  • Late GPL
  • No CPL
  • No OBCPL

Violations, 2nd visit
  • No GPL
  • No CPL
Remedial Action: Entered FROP

Lesko Funeral Home, Fairfield, CT

Violations, 1st visit
  • No CPL
  • No OBCPL

Violations, 2nd visit
  • No CPL
  • No OBCPL
Remedial Action: Entered FROP

Lester Gee Funeral Home, Bridgeport, CT

Violations, 1st visit
  • No GPL

Violations, 2nd visit
  • No significant violations
Remedial Action: FTC sent letter asking for Funeral Rule compliance

McDonald Funeral Home, Stratford, CT

Violations, 1st visit
  • No OBCPL
Apparently only one visit was performed

Remedial Action: FTC sent letter asking for Funeral Rule compliance


Key to Abbreviations
  • GPL = General Price List
  • CPL = Casket Price List
  • OBCPL - Outer Burial Container (vault) Price List
  • NFDA = National Funeral Directors Association
  • FROP = Funeral Rule Offenders Program
  • FTC = Federal Trade Commission
 

Memory's Garden Cemetery in Trouble

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CHARGES OF WRONG BURIALS, UNAUTHORIZED EXHUMATIONS, AND COVERING UP THE EVIDENCE

11/05/03 THE LATEST NEWS From The (Albany) Business Review (scroll down for the history of this case):

Board of Directors at Albany Cemetery to Resign
The board of directors of a Colonie cemetery will resign under the terms of an agreement with the New York State Cemetery Board designed to resolve mismanagement complaints.
The state cemetery board, chaired by New York state Secretary of State Randy Daniels signed a consent order with the six members of the board of directors of Memory's Garden Cemetery Inc., which operates the Memory's Garden Cemetery located on Watervliet-Shaker Road, under which the current board will be replaced by eight directors chosen by cemetery lot owners.
No current board members will be allowed to vote at these meetings or serve in any position withthe cemetery at any time. Memory's Garden officials had no comment on the settlement.
Investigations conducted by the state's Division of Cemeteries and the attorney general's charities bureau revealed financial problems at the cemetery as well as incidents of damage to vaults during the burial process, misburials, and unauthorized disinterment and re-interment of remains discovered to be buried in the wrong location.
State law specifically forbids disinterments without family consent.
"Investigations into management practices at Memory's Garden found serious deficiencies that violated State regulations protecting consumers and jeopardized the long-term financial well-being of the cemetery," Daniels said in a written statement.
The Division of Cemeteries began investigating Memory's Garden in July 2002 in response to a number of complaints about mismanagement at the cemetery. Investigators also found potential violations of state cemetery regulations related to pre-construction sales of space in a proposed "Serenity Mausoleum."
In February 2003 the Cemetery Board ordered the cemetery to stop selling spaces in the unbuilt mausoleum and to come up with a plan for fixing problems. When Daniels deemed the response from the board to be inadequate, the matter was referred to Attorney General Eliot Spitzer's office.
The settlement announced on Nov. 3 does not shield the former board members from liability for any acts for which they may ultimately be found legally responsible.
The Cemetery Board is contacting family members to inform them of the incidents, and advise them of the changes to the members of the Memory's Garden board of directors.
Under the terms of the agreement, the state cemetery board will temporarily table its review of Memory Garden's application to build the Serenity Mausoleum until the new board of directors is in place.
5/16/03
The New York State Attorney General's Office is investigating a cemetery in Albany accused of burying bodies in the wrong places and then falsifying records to cover it up. According to an investigation by the State Cemetery Board, Memory's Garden Cemetery buried bodies in the wrong locations, dug them up without permission from families or the courts,"mislead" funeral directors about the problems and then falsified its own records to hide misdeeds.

But it doesn't end there. The Board also accuses Memory's Garden's Board of Directors of violating a host of not-for-profit cemetery regulations and of putting customers' prepaid crypts in danger. According to the charges, Memory's Garden was building mausoleums on speculation, selling to customers crypt spaces that weren't even built yet.

 

"The cemetery’s sale of mausoleum space prior to construction, without filing the prices for the entombment units with the State Cemetery Board or setting aside a portion of monies received to make refunds in the event space is unavailable at the time of death, violates the New York State Not-for-Profit Corporation Law and is indicative of gross mismanagement and negligence," the report states.

 

The State Cemetery Board's report can be found here .

FCA learned of this problem on May 4, when an extremely distraught woman wrote to us by email to ask for our advice. She is horrified at the prospect of having to exhume the bodies of her husband and infant; she says their graves are among those affected in this case:

 

"Will their bodies be badly disturbed to do this? Do I need to be there? What if they exhume the caskets and they are not my family? ... I don't know where or how to begin making new arrangements or picking out another cemetery. I'm afraid my trust is just not there anymore."

According to the Albany Times-Union, the cemetery's president, Janet Kolner, denied the allegations. According to the article, Kolner said the cemetery had sent all requested information to the Cemetery Board and she couldn't understand why the case had been referred to the Attorney General's office.

Kolner also Memory's Garden's Board of Directors found no evidence of any improperly buried bodies "except for the allegations of a former employee who they view as unreliable," according to the Times-Union.

Assistant Attorney General Robert Pigott told the FCA national office that while cemeteries in New York are to be not-for-profit corporations governed by a democratically elected board, the will of many grave owners often makes little difference.

 

"In reality, there’s very little lot owner participation in these elections," Pigott said. "The Board of Directors usually has enough lots to outvote the others and reelect themselves."

The AG's office wants to hear from families who believe they may be affected by problems at Memory Gardens. Individuals can call or write to:

Robert Pigott
Assistant Attorney General, Charities Bureau
NYS Dept. of Law
120 Broadway
NY, NY
10271
212-416-8397

 

 

Bones, Bugs, and Batesville

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(This is a reprint of an article that appeared in the FAMSA Newsletter, Spring 1999)
by Lisa Carlson
The "Body Farm" it's been called—the brain-child of Dr. William Bass, a forensic anthropologist—and the only location of its kind in the country. Several out-of-town acres owned by the University of Tennessee (UT) in Knoxville have been set aside to study body decomposition and the relevant stages of insect development.

The bodies there have been donated for scientific study, and—for the most part—will end up in the university's collection of skeletons that make up a large database of body-types. With a growing collection, forensic experts are charting the differences between male and female, old and young, black and white, tall and short, heavy and thin. The skeletal studies provide a basis for computer whizzes who can then reconstruct likely features as an aid in identification.

Last Updated ( Monday, 14 July 2008 14:41 ) Read more...
 

Bait and Switch in Las Vegas

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Bait and Switch

Price Gouging at Palm Mortuary

May 13, 2001

Leroy Wright
Palm Mortuary
1325 North Main Street
Las Vegas, NV 89101

Dear Mr. Wright:

I am writing this letter to register my dissatisfaction regarding my experience at Palm Mortuary in handling the funeral arrangements for my brother, Martin A. Milley. My concern relates specifically to the way in which Palm Mortuary's charges were explained to me in advance compared to how charges were imposed at the time of signing the necessary paperwork. In essence, I believe that I have been subject to "bait and switch" tactics.

In writing this letter, I am not primarily seeking an adjustment of the charges. Rather, I want you and every one in the funeral industry to understand how short sighted and counter-productive these practices are. If this letter contributes to more effective regulation, or better yet, higher ethical standards observed throughout the funeral industry, the result would be far better than a simple adjustment after complaint.

Marty's daughter, Michelle Milley, made our family's first contact with Palm Mortuary via telephone late in the week of Marty's death. Michelle spoke with Virginia Baltier (my apologies if Virginia's name is not spelled correctly) and got details on an "ID viewing" and "direct cremation." The discussion included reference to a "Simplicity" cremation container ($125). At that time, the costs under discussion were slightly over $1,000. [Palm Mortuary's General Price List (GPL) offers Direct Cremation at $955 if the customer supplies the container and at $980 with an alternative container, a difference of $25. Apparently, over the telephone, Mr. Milley's family was going to be charged $100 more for the alternative container.]

I first spoke with Virginia via telephone on Saturday. At that time, I indicated that we wanted to invite one of Marty's friends and have a more formal viewing. Virginia told me that embalming ($440) [consistent with the GPL] and the use of a Mortuary viewing room ($325) [$180 on the GPL] would be necessary. With the understanding that total charges would be less than $2,000, I gave Virginia verbal authorization for the embalming. [Per phone quote: $955 + $125 + $440 + $325 = $1,845] Family members then committed to travel arrangements for a Tuesday, March 13 mortuary viewing. The important point here is that I was led to make these commitments with an understanding that total costs would be less than $2,000. I believe that my conversation with Virginia was very explicit in this regard.

When Michelle and I arrived at Palm Mortuary Monday morning March 12, Rick VerPlanck handled the necessary paperwork because that was Virginia's day off. Very much to our surprise, Rick insisted that rather than assembling individual charges as Virginia had quoted over the phone, we were required to start with the "CREMATION WITH VISITATION AND FUNERAL CEREMONY" package ($3180) and to delete the "USE OF FACILITIES/STAFF FOR MEMORIAL SERVICE IN CHAPEL" (-$725). While I explained to Rick the basis of my understanding with Virginia, he absolutely refused to extend the pricing that I thought that I had agreed to with Virginia before committing to the embalming and travel schedule.[It is a violation of the FTC Funeral Rule not to let the consumer pick and choose the services and merchandise wanted.]

In addition, Rick stated that the "Simplicity" cremation container ($150) that had been discussed for the "ID viewing" was not permitted in the mortuary viewing rooms. The least expensive container that he would allow in the mortuary viewing room was the "Minor - Flat (cloth)" cremation container ($295). [Again, it is a violation of the Funeral Rule to tell consumers what they must buy, regardless of which room is used for viewing.] Even after we were able to see the various cremation containers in the Mortuary show room, this remained a point of considerable contention in our conversation. However, Rick remained firm. He simply would not permit use of the "Simplicity" container. Payment in full was made via my charge card in the amount of $3,003.27 on March 12, 2001.

Finally, when I explained to Rick that the Veterans Administration told me that there was a VA death benefit, Rick handed me VA form 21-530 titled "Application for Burial Benefits (Under 38 U.S.C., Chapter 23)". When I mentioned that the VA had lead me to believe that the funeral home would help me with the form, Rick used words similar to "We don't do that anymore."

In summary, I am not very satisfied with my experience at Palm Mortuary. It seems obvious to me that I was given low price information as long as I was still in a position to take my business elsewhere. Once, as a result of travel and schedule commitments, I no longer had this flexibility, the prices suddenly changed.

As there are no other immediate family members residing in Las Vegas or within the region served by Palm Mortuary, my dissatisfaction is not likely to directly impact future business for Palm Mortuary. However, I assure you that my experience at Palm Mortuary will impact my future dealings with the funeral industry. Specifically, I expect that I will be handling the final affairs of both of my parents. In addition, shortly after finishing this letter, I intend to amend my own will to be very explicit about how I want my own affairs to be handled in this respect. I have already had a number of candid conversations with both family and friends on the subject of their personal arrangements. Palm Mortuary's short-term gain will ultimately become the funeral industry's long-term loss.

I look forward to your response.

Sincerely,
Michael Milley


May 23, 2001

Dear Mr. Milley:

I have received your letter regarding your unsatisfactory experience with Palm Mortuary. I want to apologize for the way you were treated. Your experience is not the way we try to do business. I will not defend what our staff told you: Rick was mistaken on several issues. Suffice it to say that we did not intend to mislead or deceive you.

I am enclosing a refund check in the amount of $183 which represents the difference between the $125 casket price you were initially quoted and the $295 casket you did purchase (with sales tax adjustment).

Be assured that your letter and your experience will be used to insure that what you experienced will not happen to someone else. [How might that be?]

Sincerely,

Leroy Wright
General Manager


[FCA's executive director, Lisa Carlson, wrote to the president of Palm Mortuary pointing out the FTC violations and indicated that we were considering posting Mr. Milley's complaint on our web site. The letter asked if any of Mr. Milley's facts were in dispute. The following reply was received.]

May 31, 2001

Dear Ms. Carlson:

We received your FAX regarding the complaint of Michael Milley regarding his treatment at our funeral home. Attached is a copy of our May 23rd written response, apology, and partial refund to Mr. Milley.

We are aware of the FTC rules, and we apologize for the inappropriate way our staff handled his funeral arrangements. As Mr. Wright, our general manager, responded to Mr. Milley, it was a mistake and we are taking appropriate actions to prevent a similar situation from happening in the future.

Sincerely,

Roger Kreml
Executive Vice-president

[Not finding this a very inspired response, we called Mr. Kreml: "What actions are you taking to make sure this won't happen in the future?" He replied, "We're going back to the basics with both funeral directors and how they pass the baton between one staff member and another dealing with the same family." That hardly seemed sufficient, so the problems with the General Price List were mentioned. He seemed totally unaware. We also noted that the "partial" refund of $183 was rather gratuitous when Mr. Milley had been charged $1,000 more than anticipated. Mr. Kreml didn't have much to say to that.]


The lesson to be learned:

Palm Mortuary apparently has priced its "Direct Cremation" to compete with area funeral homes or at least keep it within a few hundred dollars of what is charged at other local mortuaries. It is perfectly reasonable for a consumer to assume that, if additional goods or services are wanted, the price for each will simply be added to a package price.

But Palm Mortuary insisted on charging Mr. Milley a la carte prices that resulted in a total that was more than $1,000 over that.

How can that be, you might ask? Palm Mortuary is a prime example of funeral homes that are abusing the nondeclinable "Basic Services of Funeral Director and Staff" fee -- a sort of cover charge you must pay. This fee is for those services common to ALL funeral arrangements (meeting the family, getting the death certificate information, obituary information, and any required permits--a couple of hours work as a rule). It was never anticipated that it would be a large portion of the funeral bill. In fact, this fee--per the FTC--is supposed to be small enough to be included in package prices such as "Direct Cremation" or "Immediate Burial."

On the Palm Mortuary GPL, however, this nondeclinable fee is $1,025. Hard to see how it could be "included" in a package price of $955 that also provides significant other items. Some funeral directors claim they "discount" the "Basic" fee in the immediate disposition packages. But that is NOT what the FTC Funeral Rule says. If that were permitted, families choosing more services would pay a penalty--an extra fee--simply for wanting more services, IN ADDITION to paying for the services themselves. This is the opposite of most business practices. Of course, more elaborate services are more work and require more overhead than minimal options. But the additional recompense for the funeral home should be captured in the price of each offering, not in a nondeclinable fee that holds the consumer hostage to the tune of $1,000 or more.

Any funeral home with a nondeclinable fee of more than $400 or so certainly creates the appearance of gouging the public. FCA wants the FTC to eliminate ANY nondeclinable fee whatsoever.

 


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