week 1 Flashcards
1
Q
Who is chairman of FTC
A
Joseph Simons ***
Lina Khan as of June 15, 2021
2
Q
FTC background
- who are the FTC
- what’s their purpose?
A
- 5 commissioners appointed by the president of USA for 7 years
- -maintain free and fair competition in business
- take action against monopoly, restraint of trade, and unfair or deceptive trade practices
- prevent anti competitive practices in the marketplace as an aid to consumers
3
Q
What does the FTC do? (8) part 1
A
- Funeral service trade regulation rule
- makes it possible for you to choose only those goods and services you want or need and to only pay for those you select; whether making arrangements or preened - Clayton anti trust act
- piece of legislation passed by US Congress in 1914.
- act defines unethical business practices, such as price fixing and monopolies, and upholds various rights of labor - fair packaging and labeling act
- requires label to state; ID of product, name and place of business of manufacture, packer and distributor; net quantity of contents - truth in lending
- protects you against inaccurate and unfair credit billing and credit card practices. requires lenders to provide you with loan cost information so that you can compare shop for certain types of loans
4
Q
what does FTC do; part 2 (8)
A
- fair credit reporting act
- federal law that regulates the collection of consumers credit information and access to their credit reports. passed in 1970 to address fairness, accuracy, and privacy of the personal info contained in the files of the credit reporting agencies - Robinson-patmam act
- 1936 federal law that prohibits anti competitive practices by produces, (price discrimination). designed to protect small retail shops against competition from chain stores by fixing a minimum price for retail products - Magnuson-moss warranty act
- enacted in 1975, fed statute governs warranties on consumer products. law doesn’t require any product to have warranty, but if applicable warranty must comply with this law - cooling off regulation for door to door sales
- provides that it is unfair and deceptive for sellers engaged in “door to door” sales valued at more than 25$ to fail to provide consumers with disclosures regarding their right to cancel the sales contract within 3 business days of transaction
5
Q
Chronology of events of FTC
- Early Years
A
- 1914- FTC created be congress
- 1938- wheeler-lee amendment adds to scope of FTC
- 1964- FTC looks at funeral service and concludes that regulation is best at the state level
- 1970’s- sunset legislation eliminates various regulatory boards
- 1972- November, FTC begins review of current funeral practices
- 1973 - July, FTC initiates “non public” investigation of funeral service
6
Q
Chronology of events of FTC
-legislative years part 2
A
- 1974; Magnuson-moss warranty act/FTC improvement act gives FTC the power to create trade regulation rules. FTC calls for complaints regarding funeral service and receives 144 complaints.
- 1975; initial proposed trade regulation rule published in the federal register
- 1976; FTC conducts hearings on the proposed rule in several large cities
- 1977-1979; FTC receives temporary funding to operate as negative legislative sentiment emerges. Russo Amendment passes in the house which exempts funeral homes from FTC rules
- 1982; FTC promulgates (promotes) trade regulation rule for funeral service
- 1984; Jan 1; FTC rule takes effect (portion prohibiting misrepresentation)
- 1984; April 30; full FTC trade regulation rule for the funeral industry practices takes effect
7
Q
Chronology of events for FTC
-review years
A
- 1994; July 19; FTC funeral industry practices revised rule takes effect
- 1997; test shopping begins
- 1999; April ; formal review of the rule is initiated (scheduled to be completed in 2002)
- 2008; FTC review of Funeral rule closed with no changes
- 2020-21; review happening now
8
Q
FTC trade regulation for funeral industry practices known as “THE RULE”
A
- requirements
- violation
- all funeral provides must comply
- Pre-need
9
Q
Requirements for “THE RULE”
A
- Funeral providers cannot;
- misrepresent legal, cemetery, and crematory requirement
- embalm for a fee without permission
- require the purchase of a casket for direct cremation
- require the purchase of certain goods and services as a condition to furnish other goods and services
- engage in unfair or deceptive practices as described in “the rule”
10
Q
Violations for “THE RULE”
A
43,280 penalty per violation
11
Q
Who must comply (#3) for “THE RULE”
A
All funeral provider must comply
- funeral goods and funeral services
- you don’t have to be a funeral home; cemeteries can offer goods and services
- consumer only buys goods or only buys services; must comply to the rule because you offered both
- if you only sell goods and not services you need not comply (casket store)
- you cannot restructure your business to separate goods and services through 2 different companies
12
Q
Pre-need “THE RULE”
A
-applies to at-need and pre-need contracts
EXCEPT*
- if contract was written before 1984
- any changes made up to the contract that was written before 1984 and then changed after 1984; rule doesn’t apply
13
Q
Enforcement of “THE RULE”
A
- consumer education
- self enforcement
- direct enforcement
- FROP
compliance and enforcement may differ from state to state but all must meet the requirements of the rule
14
Q
Consumer Education
A
FTC published articles in a series entitled shopping for funeral services ; series includes
- FTC Rule
- funeral costs and pricing checklist
- types of funerals
- choosing a funeral provider
- buying a cemetery site
- planning your own funeral
- funeral terms and contact information
- also describes how consumers may file a complaint
15
Q
Self enforcement
A
-to assist the funeral provider the FTC publishes guidelines entitled, complying with the funeral rule
