In a recent legal development, Airbnb Inc. ABNB on Wednesday was slapped with an AU$ 15 million ($10 million) fine by an Australian court for misleading customers about the currency used for transactions. The court ruling also stipulates that the company is liable to compensate the affected users.
What Happened: Airbnb misrepresented Australian users by presenting prices for local accommodations in U.S. dollars as Australian dollars. This affected approximately 63,000 customers between January 2018 and August 2021, reported CNBC.
Federal Court Justice Brendan McElwaine dictated that Airbnb should pay the fine within a month for violating Australian consumer law, along with AU$ 400,000 ($269,940) for prosecution costs. Airbnb has assured the court that it may disburse an additional AU$ 15 million as compensation to eligible customers.
After admitting to the misleading representations, Airbnb made amendments to its platform on Aug. 31, 2021, to denote prices in U.S. dollars with the “USD” abbreviation. Susan Wheeldon, Airbnb’s regional manager for Australia and New Zealand, expressed regret over the incident, affirming the company’s commitment to price transparency.
The case was prosecuted by the Australian Competition and Consumer Commission, whose chair, Gina Cass-Gottlieb, stressed the importance of digital platforms complying with Australian Consumer Law.
Why It Matters: This verdict follows the lawsuit filed against Airbnb by the ACCC in June 2022. The watchdog had accused Airbnb of duping users into paying more by advertising and charging room rates in U.S. dollars without indicating the figures in Australian dollars. At that time, Cass-Gottlieb said Airbnb had not compensated many consumers who had been misled, leading to the ACCC arguing for court-ordered Airbnb compensation.
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