A client called me for advice concerning a friendly inquiry received from a state regulator about the non-compliance of the funeral home’s General Price List (“GPL”) with the FTC Funeral Rule. When I reviewed the client’s GPL, other contracts and forms required by state and federal law I discovered that the client had recently revised many of the contracts and forms used in the business to update them to be in compliance with recent law changes. These changes were made by a committee of employees that had been directed to update all of the forms used in the business. Unfortunately, changes were made to the wording of disclosures and formats to simplify wording that was not in compliance with the legal requirements.

  Updating your contracts and forms, of course, is a prudent practice that I continually recommend to clients, particularly when there are changes in laws. However, when you do update your contracts and forms make sure that you comply with the legal requirements. In particular do not change the wording of required disclosures or the organization of contract to a different format from the traditional used in sample forms issued by a federal or state regulator.

  The client was fortunate that the state regulator alerted the business about the problem instead of issuing a citation and asserting penalties. The author knows from personal experience that the FTC staff would not have been so lenient. Several years ago a client ended up with a $20,000 fine for changing the language of required disclosures that the regulator admitted was better than the official language but was not in compliance with the legal requirements.

  There are many laws that apply to industry members that have requirements for forms with disclosures. It is important that industry members are aware of the laws that apply to their operations. The term industry members covers cemeteries, funeral directors, crematory operators and related individuals or entities. Check the industry trade association websites for information about applicable laws and changes. It is also important that industry members keep up with changes in these laws by attending events sponsored by industry trade associations including those that comply with continuing education requirements for those members subject to those requirements.

  Ignorance of the law is no excuse. Also, there are many agencies of the federal and state governments that have jurisdiction over the special laws applicable to the businesses of industry members. At the federal level, the FTC has jurisdiction of funeral providers under the FTC Funeral Rule. The FTC also has jurisdiction over the federal consumer credit and consumer protection laws. At the state level there typically is a state agency that is involved with the licensing and operation of industry members. The same agency may also have jurisdiction over trust funds established and maintained by industry members but sometimes it is a separate agency. The attorney general’s office in most states deals with the Unfair and Deceptive Practices Acts that incorporates by reference the FTC Funeral Rule in addition to their jurisdiction over consumer protection and consumer credit laws.

  Finally, before finalizing changes to contracts and forms, it would be prudent to have the contracts and forms reviewed by experienced professionals to make sure they are in compliance. Mistakes can be expensive if noticed by a regulator that has jurisdiction.