How AirBnB Could Become the Coolest Way to Run an Illegal Casino

Politicians believe AirBnB could be the latest trend in prostitution, illegal gambling and the drug industry.

Four years ago, a cool new business was being set up in San Francisco. The new service was called AirBnb and it was supposed to be a great, cheap alternative to expensive hotels. Today, lawmakers in America are raising the alarm that the service could become the root of all that’s evil.

From stories about escort services using AirBnB, it was only a matter of time until someone would bring up gambling and drugs. Now politicians are associating the startup with illegal activities and encouraging people to go back to the traditional choice when arranging their vacations: the hotel industry.

AirBnB, a prostitute’s best friend

Earlier this month, the New York Post had some very interesting things to reveal about AirBnB. An article published in the newspaper told the story of an anonymous sex worker who claimed the “industry” regularly uses AirBnB to save money.

AirBnB is a company allowing people to rent out their rooms. It has over 500,000 listings in 33,000 cities and 192 countries. Other companies offering similar services include:

• 9flats
• Alterkeys
• BeWelcome
• CouchSurfing
• HomeAway
• SleepOut.com
• Travelmob

Privately-owned apartments rented out through the web service usually go for $200 to $400 a day. “It’s more discreet and much cheaper than The Waldorf,” the prostitute told the Post. “[They] probably save $200 to $300 a night by not getting a hotel. It’s really good for business.”

The article continued with the story of 29 year-old publicist Jessica Penzari, who rented her apartment at the end of March, only to find out that her home had been used as a brothel. The company put her up in a fancy hotel for two nights and paid to have her flat cleaned, locks changed, her pillows and other such belongings replaced.

The reporter also referred to other such incidents and sexual escapades, including an “XXX Freak Fest” held in an apartment in Chelsea, in February.

Gambling and drugs are next

After reading the report published in the New York Post, state Senator Liz Krueger sounded the alarm and took the issue to a whole new level. She figured if escorts take their “business” to AirBnB, the uncontrollable spread of illegal gambling rings and drug dealers must be just around the corner.

“The outcome of this, predictably, has been constant streams of tourists disrupting residential buildings, and other inappropriate, even illegal activity floating from building to building,” she wrote in a statement published in recent gambling news.

“Today it’s a prostitution ring, tomorrow it could be an illegal gambling ring, and maybe next week it could be a drug operation. There’s really no way to know.”

In 2010, Krueger sponsored a law which allowed the state to take action against illegal short term renters. She believes prostitution to be an “obvious” consequence of AirBnB’s business.

“When residential housing ceases to be residential – via online businesses, like AirBnB, turning residential apartments into illegal, unregulated hotel rooms – all kinds of undesirable and illegal activity can be brought into a residential building,” she stated.

Homes turned into illegal casinos?

With the online home-rental service posing such a danger to society, Krueger declared war against it: “If AirBnB were truly responsible, they would stop openly violating our local laws, or at least stop enthusiastically encouraging New Yorkers to rent out their apartments without giving them fair warning that it’s probably illegal, almost certainly violates their rental lease or coop/condo rules, and could get them evicted,” she said.

Now the company has been accused of breaking state law and called in court against New York Attorney General Eric Schneiderman. According to local news reports, nearly two-thirds of the apartments listed via the web service were illegal sublets, as local regulations prohibit renters from subletting their room for less than 30 days.

But what does all this have to do with gambling? Could rented homes really become the next choice for criminals running illegal American poker rooms? It’s true that most underground gambling operations are run from apartments, but criminals are unlikely to go through the trouble of renting a flat.

New York has a lot of problems with illegal gambling rings, as local news has reported over the past few years. Brooklyn is home to most of these underground casinos or illegal betting operations. However, AirBnB hasn’t been involved in any of them so far.

Still, it looks like politicians and local authorities have managed to kill another dream: that people can find affordable accommodation around the world, through a cheap, trusted service.