by Mia Taylor
Last updated: 7:00 AM ET, Wed January 16, 2019
Earlier this week, New York City filed a lawsuit against real estate brokers who it accused of using Airbnb illegally to run a hotel operation.
According to a report in Curbed New York, the city's lawsuit says the group of brokers from Metropolitan Property Group used fake identities on the home sharing platform and multiple corporate accounts to organize the scam.
The New York Times, which originally reported the story, said the $21 million lawsuit filed by the city may be the largest ever brought against an illegal hotel operator.
The firm apparently used numerous fake identities and as many as 18 corporate entities on Airbnb to convert 130 apartments into what amounted to illegal hotel rooms.
More than 75,000 guests were apparently served as part of the scam between 2015 and 2018, according to the same suit. What's more, about $21 million worth of profits were raked in by Metropolitan Property Group.
The CEO from the real estate brokerage firm, Sami Katri, told a New York Times reporter that the allegations were false but declined to provide any additional comments, according to Curbed.
The news comes on the heels of a judge in New York City issuing an injunction against legislation that would require Airbnb and other similar listing sites to routinely disclose information about hosts and listings.
Because of the injunction, the law will not take effect next month as planned. It will be stalled until the litigation is concluded.
While it's not clear what harm may have come to the travelers who booked rooms through the scheme, travel agents say reserving accommodations through Airbnb comes with its share of risks.
"It's safer for consumers to book their travel accommodations with a travel agent because like myself, agents recommend properties or hotels that they have experienced," said Rene Fifik, of On Your Way With Rene Travel. "With Airbnb, you do not know what you're getting until you arrive. When booking with an agent, the agent knows the hotel and can recommend appropriate accommodations to the client's needs and wants."
Camille Sperrazza, owner of New York City-based The World Awaits, said many of the travelers who booked rooms through the Metropolitan Property Group scheme probably had no idea they were doing something illegal.
"That's a big issue for travelers to consider," said Sperrazza. "I have also had people contact me as they boarded a flight because their stay at an Airbnb was canceled at the last minute. The last thing one wants on a vacation is to be stressed about matters like these. People go on vacations to de-stress. I travel the globe and would never consider staying at an Airbnb property. Who knows how many people have access to the key? I would be afraid to close my eyes at night."
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