A class action lawsuit claims that HomeAway, a company that facilitates online vacation rentals, does not properly notify renters of scams perpetrated via its website. The HomeAway class action lawsuit was filed by Linda Spacil, who says that she booked a vacation rental in Switzerland through HomeAway. Allegedly, the vacation rental turned out to be a scam, and HomeAway failed to properly notify Spacil. Ring of Fire’s Farron Cousins discusses this with Scott Hardy from Top Class Actions.


*This transcript was generated by a third-party transcription software company, so please excuse any typos.

Farron Cousins:                  In just the last few years, we have seen a multitude of different companies pop up offering discount hotels. They’re going to compare rates to other sites, get you the best deal possible. Even offer private listings such as Airbnb or other services where people can rent out their homes to vacationers. But as is often the case, the more companies that pop up, the more problems we begin to see and we’re starting to see consumers getting ripped off from some of these services. Sometimes the service knows about it, sometimes they don’t.

But I have Scott Hardy from Top Class Actions with me now to tell us what consumers need to be aware of. And Scott, this particular issue that we are talking about today happens to deal with HomeAway. HomeAway, for those who may not know, offers a vacation rentals through their website. People who own a rental, own whatever it is, can put it on HomeAway. Consumers look at it, book it, everything done through there. So what issues are we finding out right now with HomeAway?

Scott Hardy:                          So what we’re seeing are, is rampant fraud across HomeAway and Airbnb. And so viewers have to be especially careful when you’re trying to book your vacation and you’re choosing an Airbnb or a HomeAway and this case you have HomeAway that was hit with a class action because a consumer went on there, found a home they liked, talked to the seller, the seller said, hey, I’ve got to cancel your listing right now, to give you a coupon, give you a discount. Go ahead and, and wire your money over. You’ll get all processed and you’re set.

They did that and then it turned out that the listing was fraudulent. The lister was a scammer, there was no house and that person was out their money. Now of course they went back to HomeAway and said, hey, I just reserve this home. Here’s my documentation, here’s my emails. I wired the money and then they disappeared. What’s going on? And usually when this happens, you know, the company will say, man, all right, yes, we know there’s fraud. We’ll go ahead and refund you.

We’re sorry we’re working on battling it. And this case, HomeAway did not say that. And I’m curious if HomeAway actually has official reply to this class action because you know the way things went about, I’m wondering if this person actually violated their terms of service. Because with all of these online rentals you have to pay them and typically you have to pay them through the online rental service and you do not want that canceled for any reason.

Because then if it’s fraudulent they’ve got, they’ve got the record. So I would absolutely encourage folks to follow the rules that are set forth in your contract to the letter. If you’re using Airbnb or HomeAway. That will make it much more likely that you’ll get your money back and not have to file a class action. And if you do have to file a class action, then the lawyers who are going to file it will have that paperwork to back you up.

Farron Cousins:                  You know, this is really, you know, quite scary actually for consumers out there considering the fact that vacations are huge expenses, which is why on average most Americans aren’t taking vacations anymore. They can’t take the time off work. And even if they can, they can’t afford them anymore. So when you do go through all this trouble, you finally find a place you like maybe one big enough to fit your family or your friends or whoever’s going with you and you pay that money up front.

That’s the bulk of your vacation spending. And if you find out, you know, couple of weeks down the road right before your trip, oh, the place you just booked doesn’t technically even exist. There goes everything. You know, your money is gone. You know, your, your plans are destroyed. Maybe this big grand vacation you’ve been planning for months is suddenly not happening. I mean, this is awful for people. This is absolutely awful.

And yes, these companies have a responsibility to know whether or not the properties listed on their site are real or fraudulent. You know, I, I feel like that is up to the company here, HomeAway, Airbnb, whoever it is, you have to have these things verified and they may have to start taking the extra steps of verifying it for themselves. You know, possibly even sending people out there to get some kind of live footage of a residence or physically put a person in there to know that it exists. Otherwise, you know, it’s a crap shoot with these properties.

Scott Hardy:                          Right. And, and you, you’ve got some verification that that has to happen. Consumers can, they can actually do a little due diligence on their side. So you know they should always, if they’re worried about it, they should always ask the home owner, do you own this home? Make sure you’ve got their names. Do a, do a real estate search. You know, here in the state of Arizona, you can look up a property and see who owns it just on the tax records.

You can do that anywhere in the country. Take a look and see if there are any reviews for the property. That is huge. If you see a good deal on a property, but there’s only one or two or three reviews, be very careful. You want to go with these properties that have a lot of reviews because that will get, make, help make sure, give you one extra little iota of confidence that it is real and it’s not held by a scammer. And so if you go ahead and do a little due diligence, then you could help safeguard it.

But you’re right, the companies Airbnb, VRVO, or in this case, HomeAway, they should be doing that due diligence themselves. So you as a consumer know you can put in your credit card, you can rent it, and you are safe that you will get to that house or that condo and you will be able to enjoy your vacation without it worrying of disappearing while you’re on your way.

Farron Cousins:                  Absolutely. If anybody has experienced any issues with anything we’ve discussed today, please follow the link in the description of this video. Head over to Top Class Actions. And while you’re there, make sure you sign up for their weekly newsletter, one of the best resources available for consumers. Scott Hardy, Top Class Actions. Always a pleasure talking to you.

Scott Hardy:                          Great talking to you too Farron. Thank you.


Farron Cousins is the executive editor of The Trial Lawyer magazine and a contributing writer at DeSmogBlog.com. He is the co-host / guest host for Ring of Fire Radio. His writings have appeared on Alternet, Truthout, and The Huffington Post. Farron received his bachelor's degree in Political Science from the University of West Florida in 2005 and became a member of American MENSA in 2009. Follow him on Twitter @farronbalanced