California man accused of nationwide ‘bait and switch’ Airbnb scam

A California man has been arrested in connection with what prosecutors are calling a “double-booking-bait-and-switch scheme.” They allege he earned millions of dollars from more than 10,000 Airbnb and Vrbo vacationers, all while lying to some of the guests and the rental companies.

Shray Goel, whose personal website calls him a “visionary in real estate,” faces 13 counts of wire fraud and two counts of identity theft, according to an indictment filed in December in the U.S. District Court for the Central District of California and shared by 404 Media. Goel was arrested in Florida on Dec. 27 and released on bond the next day, Central District spokesperson Thom Mrozek told SFGATE. No court date has been set, but the proceedings will be in Los Angeles.

In the indictment, prosecutors said that from 2018 to 2019 Goel would double-book homes, then cancel guests’ reservations at the last minute for bogus reasons, sometimes moving them to inferior lodgings. After the “bait-and-switch,” prosecutors allege, Goel would then lie to either customers, the rental companies or both in order to avoid paying refunds. 

Prosecutors allege that Goel created a “secret bidding war” for properties, by leaving them open for repeated bookings and then canceling for everyone but the highest-paying guests.

“Defendant GOEL and others working with him booked more than 10,000 reservations through Airbnb, receiving more than $7 million in payouts on those reservations; they booked additional and sometimes conflicting reservations through Vrbo and received more than $1.5 million in additional payouts from those reservations,” the indictment said.

Prosecutors allege Goel and his “co-schemers,” who were not named, tricked renters with properties in Malibu and Los Angeles, as well as in Chicago, Denver, Nashville, Tennessee, and Austin, Texas. They say some of the addresses Goel listed for rent were completely fake, an allegation that lines up with a 2019 investigative feature into Goel and his real estate company by reporter Allie Conti for Vice.

Conti had booked a short-term rental for a trip to Chicago, she wrote, but at the last minute, her host told her the apartment had a plumbing issue. She agreed to be moved to another of the host’s properties — it turned out to be grimy, didn’t match the photos and wasn’t at the listed address. 

After a day, the host told Conti and her friends they’d have to leave to let new guests in. She only got $399 refunded out of the $1,221.20 bill. 

The reporter dug into her hosts, “Becky and Andrew,” and found the account seemed to be linked to five questionable Airbnb profiles, listing “at least 94 properties in eight different cities.” She talked with other vacationers who’d had similar experiences, and eventually found, in a Wisconsin property’s public ownership records, the name Shray Goel. 

Airbnb, when prodded by Conti, suspended some of the listings she attributed to Goel, she wrote. The FBI reached out to Vice the day after Conti’s viral article was published — his arrest came four years later.

On a Tuesday phone call, Goel declined to provide an on-the-record comment to SFGATE. Goel’s personal website says he built a real estate business with $20 million of assets under management, but, “A series of unfortunate events that culminated in a global pandemic decimated my business virtually overnight. I was crushed.” 

Late in 2019, Airbnb pledged to verify all of its listings after a shooting during a party at an Orinda, California, guest house left five people dead. The San Francisco-based company intensified the effort in 2023, TechCrunch reported, by having hosts send photos with GPS data and creating a verified symbol for checked-off properties. The symbol is reportedly expected to go into use in February of 2024.

“Airbnb is built on trust, and bad actors have no place in our community,” Airbnb spokesperson Elle Wye said in a statement Tuesday to SFGATE. “We supported the US Attorney’s Office and the FBI throughout their investigation to help ensure accountability, and we are thankful to them for their work.”

Hear of anything happening at Airbnb or another tech company? Contact tech reporter Stephen Council securely at [email protected] or on Signal at 628-204-5452.