ACCC warns funeral providers on pricing practices following Youpla collapse

12 October 2022

The ACCC is warning funeral services providers not to mislead consumers about prices and to act honestly and transparently in their dealings with Indigenous Australians affected by the March 2022 collapse of the Youpla Group (formerly the Aboriginal Community Benefit Fund).

The Australian Government has commenced a program to pay a grant in place of a funeral benefit that would have been paid by Youpla Group to eligible beneficiaries of people who held an active Youpla Group policy on or after 1 April 2020.

The ACCC is warning funeral service providers to not seek to take advantage of the Youpla Group Funeral Benefits Program by raising prices for funerals of grant recipients and their families, leaving these families out of pocket.

“Funeral service providers should not take advantage of the grant payments that may be available to families of fund members by increasing the price of funeral services,” ACCC Deputy Chair Delia Rickard said.

“Businesses should know that we will take action if misconduct is identified as this grant program commences, and that excessive pricing may, in certain circumstances, raise concerns under the Australian Consumer Law.”

“In particular, funeral providers must not make false, misleading or deceptive claims about the cost of funeral services. Funeral providers often deal with families at a time of grief and often financial pressure, when people are particularly vulnerable. They must not abuse that vulnerability,” Ms Rickard said.

“We have previously highlighted our concerns about certain practices in the funeral industry, and we will not hesitate to take appropriate action if we see evidence of breaches of the law.”

The ACCC published a report highlighting its concerns about the funeral sector in December 2021, pointing to several issues, including a lack of clarity and transparency in pricing information provided by some funeral businesses.

The ACCC recommends that families seeking quotes for funeral services avoid disclosing to funeral providers that they are eligible for payments under the Youpla Group Funeral Benefits Program until they have obtained a quote and chosen a provider.

Families should also consider seeking more than one quote where a choice of funeral services is available to them.

“The best way for businesses to avoid misleading consumers is to be upfront about the costs associated with their services, and avoiding describing charges as ‘mandatory’ when that is not the case,” Ms Rickard said.

“Consumers can also ask the provider for information about the minimum cost covering only the essential services when comparing their options.”

“Sorry Business is of the deepest cultural importance to Indigenous Australians, which is why we will be closely monitoring any reports alleging that funeral businesses are taking advantage of government payments, making misleading or deceptive statements to consumers, acting unconscionably or anti-competitively,” Ms Rickard said.

Background

The Youpla Group, which was previously called the Aboriginal Community Benefit Fund, entered into liquidation in March 2022. More information about the liquidation process is on the ASIC website.

The Australian Government has started the Youpla Group Funeral Benefits Program to help the families of fund members affected by the collapse. The Program will pay a funeral benefit for a person who has died who was a Youpla Group fund member on or after 1 April 2020.

Applications to the fund opened in September and need to be made by 30 November 2023.

ASIC also has ongoing proceedings in the Federal Court against ACBF Funeral Plans Pty Ltd and Youpla Group Pty Ltd (both in liquidation) alleging these entities engaged in misleading and deceptive conduct and made false and misleading representations, in offering, promoting and selling certain funeral benefits plans.

The ACCC has published consumer and industry guidance to assist funeral businesses in complying with the requirements of consumer and competition laws and to help consumers make informed choices when organising a funeral service.

The ACCC has previously taken action against funeral services providers Coventry Funeral Homes, WT Howard Funeral Services, Alex Gow Funerals, Bare Cremation, Parkside Funerals and Bowra & O'Dea.

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