San Francisco sues booking sites over scam hotel rooms

San Francisco City Attorney David Chiu says the booking sites mimic actual hotel sites and overcharge travelers.SAN FRANCISCO (CN) — San Francisco sued two booking sites Wednesday over deceptive business practices, accusing the sites of scamming travelers into thinking they are booking directly with hotels and overcharging room rates.In the lawsuit, filed in San Francisco Superior Court on behalf of the people of California, the city claims GuestReservations.com and BookOnline.com use misleading online advertising and websites that mimic official hotel sites to get consumers to book hotel rooms through their platforms at significantly higher rates.The city says when consumers realize they did not book directly with a hotel and try to cancel their reservation, the sites refuse to refund their money.“Tourists simply trying to check in are getting cleaned out by this hotel booking scam,” San Francisco City Attorney David Chiu said in a statement.“These companies mislead consumers into thinking they’re booking directly with a hotel, charge exorbitant rates, and impose inflexible cancellation policies. With inflation straining household budgets, these excessive markups only add to the burden. These scams hurt travelers as well as our local hotels, workers and businesses. We are asking the Court to shut these scams down and help us get people their money back.”The city names the operators of GuestReservations.com and BookOnline.com, as well as the online travel company Booking Holdings, as defendants.The city claims GuestReservations.com and BookOnline.com use ads that appear at the top of search engine results, sometimes higher than the actual hotel’s website, as well as similar URLs to the intended hotel’s site, to trick consumers into clicking on their link.Once clicked, consumers are taken to a website that mimics the desired hotels’ actual online booking portal. Reservations on the sites usually require consumers to pay upfront in full, are nonrefundable, and cost up to 85% more compared to when booking direct, according to the city.Further, the city claims the sites may also list local phone numbers for the areas the hotel is located in, the city says, and when called, the agent on the phone does not disclose they work for a third-party platform.The city claims Booking Holdings is not only aware of the third-party sites’ conduct, but is an active participant in the scam, supplying hotel rooms to the third-party sites and facilitating the transactions — all while collecting a fee for each booking.“Because Booking Holdings receives revenue each time a consumer books a room on a partner platform rather than through the hotel directly, it has a financial incentive for its partners to sell rooms. Though it is aware that the website defendants are securing reservations deceptively, it does nothing to stop them, all the while profiting from each hotel room booked.”The city says more than 1,800 consumer complaints have been filed with the Better Business Bureau against GuestReservations.com and BookOnline.com, with BookOnline.com earning a BBB rating of “F.”The city’s claims include unfair business practices against the third-party sites and aiding and abetting against Booking Holdings. It asks the court to block the defendants from continuing their supposed unlawful conduct, as well as order them to pay restitution to California consumers and a $2,500 civil penalty for each violation of unfair or fraudulent business practices.Representatives for the defendants did not immediately respond to a request for comment.Subscribe to our free newslettersOur weekly newsletter Closing Arguments offers the latest about ongoing trials, major litigation and rulings in courthouses around the U.S. and the world, while the monthly Under the Lights dishes the legal dirt from Hollywood, sports, Big Tech and the arts.Additional Reads