Funeral services providers have been warned against raising prices to take advantage of a federally funded program for beneficiaries of Indigenous policyholders affected by the collapse of Youpla Group.

The Australian Competition and Consumer Commission (ACCC) says it will be monitoring the industry for potential misconduct as the Youpla Group Funeral Benefits Program commences.

The program started accepting applications last month with the Federal Government expected to cover around $4 million in funeral claim expenses for beneficiaries of Youpla policyholders.

“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.”

She says funeral services 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 Youpla Group Funeral Benefits Program will accept applications until November 30 next year.

The Federal Government established the scheme in consultation with consumer advocates and First Nations representatives, who have been pressing for financial assistance to support those affected by the Youpla collapse.

Youpla, also called the Aboriginal Community Benefit Fund, collapsed earlier this year. The business was exposed during the 2018 Hayne royal commission over its use of high pressure and misleading sale tactics to sell near-worthless funeral insurance products to the Indigenous community.