Airbnb will have to pay up to $30 million

Airbnb will have to pay up to $30 million for deceiving Australians about the cost of lodging

After acknowledging that it had misled tens of thousands of Australian clients about the cost of its lodging for over four years, AirBnB has apologized to its patrons.

In addition to agreeing to pay up to $15 million in additional compensation to impacted consumers, the short-stay housing website Airbnb was ordered by a federal court to pay $15 million in fines today.

Prices for accommodations in Australia were shown on the Australian section of Airbnb's website with a dollar sign between January 2018 and August 2021; however, it was not made clear if these prices were in Australian dollars or foreign money.

These costs were, in fact, in US dollars for about 63,000 customers who placed 70,000 reservations on Airbnb. Over 2000 users of the lodging booking website complained that they were being charged in US dollars during this time, but nothing was done about it until August 31, 2021, when the website was changed to make it obvious that pricing was in US dollars by using the symbol "USD." Consumers were misled about the price of accommodation, reasonably assuming the price referred to Australian dollars given they were on Airbnb's Australian website, searching for accommodation in Australia and seeing a dollar sign," Gina Cass-Gottlieb, chair of the AC.

Airbnb Ireland UC (Airbnb) has been ordered by the Federal Court to pay $15 million in penalties and implement a court-enforceable compensation program for approximately 63,000 affected consumers. These consumers, who had over 70,000 bookings billed in US dollars, were charged more than anticipated due to misleading conduct regarding the pricing.

The compensation program could amount to an additional $15 million, providing affected users with reimbursement for the discrepancy between the listed price in Australian dollars and the actual amount paid. This compensation also covers any extra foreign currency transaction fees incurred by consumers, with an estimated average compensation of around $230 per individual.

The court found that by charging consumers in US dollars, Airbnb deprived them of the opportunity to make informed decisions about their bookings, as they ended up paying more than expected due to fluctuations in the USD/AUD exchange rate at the time. Some users also incurred additional charges from their banks due to the foreign currency transactions.

Airbnb Country Manager for Australia and New Zealand, Susan Wheeldon, acknowledged the currency confusion and stated that the issue was promptly addressed upon discovery. She explained that, during the initial stages of booking, the US currency code was not displayed on the website, but it appeared on the final booking page before guests confirmed their purchases. While only a small percentage of Australian guests were believed to be impacted, Airbnb expressed regret for the situation and issued an apology to affected guests. Eligible consumers are set to be contacted by Airbnb within the next 45 days to facilitate the compensation process.