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Hotelier Testifies on Impact of Online Hotel Booking Scams

Washington, D.C. – May 25, 2016 The U.S. House Committee on Energy & Commerce Subcommittee on Commerce, Manufacturing, and Trade today held a hearing in which it discussed the impact of hotel booking scams on consumers. The hearing focused on H.R. 4526, the Stop Online Booking Scams Act, which is legislation cosponsored by Representatives Lois Frankel (D-FL), Ileana Ros-Lehtinen (R-FL) and Bill Shuster (R-PA), that would help protect consumers, businesses, and innovation, as well as ensure consumers are not deceived during the hotel booking process.

With some five million guests checking into hotels each day, this hearing is particularly important as the spring and summer travel season is underway. Research by the American Hotel & Lodging Association (AH&LA) shows that an increasing number of consumers are misled into making hotel reservations through fraudulent websites and call centers that give the appearance of being a hotel’s website, but actually have no relation to the hotel. As consumers increasingly move to mobile booking, smaller screens make it harder for consumers to differentiate between the scam site and the legitimate hotel’s website and indications that could have otherwise been key to consumers knowing the difference, like URLs, are, at times, hidden.

These scams result in wholly lost reservations, incorrect accommodations, the wrong services guests often need, such as disability access, the wrong set of amenities such as two double beds or rooms next to each other for families, lost loyalty benefits, and clear consumer confusion. Some 15 million bookings each year are impacted by these scams, which translates to $1.3 billion in bad bookings.

AH&LA applauded Omni Hotels & Resorts for testifying at the hearing and underscoring the importance of this bill. Jamie Pena, Vice President of Revenue Strategy & Global Distribution for Omni Hotels & Resorts testified on behalf of 18,000 Omni hotel associates and the industry, and provided insight into what these scams mean for guests.

“It is an honor to appear before the committee today to share with you Omni's experience working to prevent consumer deception and fraud in online hotel bookings and the need for Congress to pass the Stop Online Booking Scams Act… Unfortunately, consumer education is not proving to be enough. As the number of consumers booking hotels online continues to rise, especially in the mobile space, so will the instances of deceptive sites. That is why I am here to express our support for the Stop Online Booking Scams Act. This bipartisan legislation will help protect consumers from these online hotel booking scams by prohibiting websites from pretending that they are an actual hotel... and go after those truly rogue scam websites that are clearly designed to deceive the consumer,” she testified.

Vanessa Sinders, AH&LA’s Senior Vice President of Government Affairs, echoed Ms. Pena’s support of the legislation: “Consumers should not have to worry about being deceived throughout the booking process and this legislation is pivotal to stopping this kind of unscrupulous activity where fraudulent websites pose as the hotel’s website. Hotel guests should not have to be a detective to determine whether or not they are booking directly with the hotel. It is always safest and best to book direct – so consumers should have that option. We thank the original cosponsors, Representative Lois Frankel, Ileana Ros-Lehtinen and Bill Shuster, for their diligent work on protecting consumers. And we are grateful to Jamie for sharing her company’s experience and we urge lawmakers to move swiftly through the legislative process to pass this important bill into law.”

The Federal Trade Commission, the Better Business Bureau and various other consumer advocacy groups have already issued strong warnings about these scams. The Stop Online Booking Scams Act takes further, much needed action, to prevent scammers from continuing to exploit unassuming consumers. By requiring third party booking sites to have continuous, prominent notification that their websites are not associated with a specific hotel’s website before any consumer’s credit card is charged, this legislation will make it crystal clear to consumer who they are doing business with online. This legislation will also allow for the state attorney generals to pursue damages and restitution on behalf of victims.

To read Jamie Pena’s full testimony, please click here.

To view the full list of witnesses, please click here.

About AH&LA

Serving the hospitality industry for more than a century, the American Hotel & Lodging Association (AH&LA) is the sole national association representing all segments of the 1.9 million-employee U.S. lodging industry, including hotel owners, REITs, chains, franchisees, management companies, independent properties, bed and breakfasts, state hotel associations, and industry suppliers. Headquartered in Washington, D.C., AH&LA provides focused advocacy, communications support, and educational resources for an industry of more than 53,000 properties generating $176 billion in annual sales from 5 million guestrooms.

Contact: Katie Longo

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