Frankel, Ros-Lehtinen, Shuster Introduce Bill to Combat Online Hotel Booking Scams

Feb 10, 2016

Frankel, Ros-Lehtinen, Shuster Introduce Bill to Combat Online Hotel Booking Scams

Washington, D.C. – Today, leading a bipartisan effort, Congresswoman Lois Frankel (FL-22), Congresswoman Ileana Ros-Lehtinen (FL-27), and Congressman Bill Shuster (PA-09) filed the Stop Online Booking Scams Act to combat online hotel booking fraud.  With these scams, con artists set up phony websites that pose as a hotel’s official site, tricking consumers and pocketing their money without making an actual reservation or fulfilling promises.

“Booking a hotel room for a dream vacation should not lead to a nightmare,” Rep. Frankel said. “This bill will reduce fraud and give law enforcement more tools to protect travelers.”

“I’m proud to work with my colleagues, Lois and Bill, on stopping fraudulent hotel booking websites,” Rep. Ros-Lehtinen said. “So many Americans conscientiously save for their vacations and are deeply disappointed when they discover they have been victims of a crime. Congress should do all it can to crack down on these perpetrators of fraud who take advantage of both families and the businesses the websites impersonate.”

“There’s an alarming problem with rogue websites defrauding families that are simply looking to find a nice place to stay while they enjoy their vacations,” Rep. Shuster said. “I was happy to support this measure as it will make it harder for these scams to occur and make it easier for travelers to know that the websites they are using to book their stays are legitimate.”

According to the American Hotel & Lodging Association (AHLA), close to 15 million reservations were made on deceptive hotel booking sites in the last year alone, resulting in guests finding themselves out hundreds of dollars for either a worthless reservation or one that delivered much less than promised. AHLA estimates that these scams cost U.S. travelers upwards of $1.3 billion per year.

This bipartisan bill would address this widespread problem for consumers by:

·         Requiring disclosure – All third-party hotel booking websites would be obligated to disclose, clearly and conspicuously, that they are not affiliated with the hotel for which the traveler is ultimately making the reservation. This new requirement will help consumers know when they are actually on a hotel’s website and when they are instead on a third-party booking site, which will help identify fraudulent sites masquerading as name brand sites. Violators would face fines of up to $11,000 per infraction, be responsible for financially compensating fraud victims, and have their illegal website shut down.

·         Giving more power to states – State Attorneys General would have the ability to go after these fraudsters in federal court and seek damages for victims. In most states, under current law, only federal authorities can fully penalize criminals who commit online hotel booking fraud.

·         Simplifying the fraud reporting procedure – The FTC would be encouraged to simplify its online complaint system for reporting online hotel booking scams, and it would be required to produce a study on the impact of this fraud on consumers.

The measure is endorsed by the American Hotel & Lodging Association, the leading group representing the nation’s hotel industry.