Ex-Airbnb employees told Bloomberg the company faces thousands of sexual-assault claims annually.
Bloomberg's investigation revealed Airbnb has kept many of those cases out of the public eye.
Payouts, arbitration, and NDAs have helped Airbnb avoid scrutiny on safety issues, Bloomberg found.
Former Airbnb employees said that the company deals with thousands of sexual-assault allegations every year, and that the vast majority of them never make it into the public eye, Bloomberg reported this week.
Its investigation disclosed new details about how Airbnb has used a combination of monetary settlements and legal tactics - such as mandatory arbitration clauses and nondisclosure agreements - to avoid lawsuits and negative press dealing with a variety of safety problems.
The result, Bloomberg found, is that regulators, researchers, and the public have had little visibility into the scope of safety incidents involving Airbnb and that courts haven't had the opportunity to determine who should be held legally liable.
Airbnb spends about $50 million a year trying to make things right for guests and hosts who've had bad experiences. One woman received a $7 million settlement after she said she was raped, Bloomberg reported.
The company told Bloomberg fewer than 0.1% of stays involve safety issues, that most payouts deal with claims of property damage, and that six-figure payouts are "exceptionally rare." But with 193 million nights booked in 2020, that could mean that some 193,000 Airbnb stays could've involved safety incidents, by the company's accounting.
Airbnb has dealt with a number of high-profile incidents over the years, including its first major scandal in 2011 after guests trashed a host's home and a fatal shooting in Orinda, California, in 2019 that forced the company to crack down on party houses and ramp up efforts to keep guests and hosts safe.
Bloomberg's reporting showed that Airbnb avoided scrutiny for serious incidents involving its guests, hosts, and listings, including numerous claims of sexual assault and a murder case.
Airbnb used to include a nondisclosure agreement in every case it settled, which prevented people from talking about their experiences, asking for more money, or suing the company, Bloomberg reported, adding that the company stopped the practice in 2017 as the #MeToo movement highlighted how NDAs often silence survivors of sexual assault.
An Airbnb spokesman, Ben Breit, told Insider that to the company's knowledge, "There are no settlement agreements related to sexual assaults at listings prior to 2017." (The $7 million settlement with the woman who was sexually assaulted was reached in 2017, after Airbnb stopped pursuing settlements with NDAs that prevent survivors from discussing details of their experiences, Bloomberg reported).
Airbnb has avoided lawsuits and public scrutiny over safety by including a mandatory arbitration clause in its terms of service. Such clauses prevent Airbnb guests and hosts from suing the company in court, where records are made public, instead forcing them to bring disputes through an arbitration system that's funded by, and often favors, companies - and where proceedings are kept confidential.
That apparently led to only one sexual-assault case being filed against Airbnb, which the courts allowed to proceed because, they said, the company hadn't done a thorough background check on the host, who had previously been accused of assault, Bloomberg found.
Airbnb declined to comment on its use of arbitration clauses.
Airbnb's ability to reach settlements and avoid lawsuits, either dealing with sexual assault or other safety issues, has prevented courts from determining when and to what extent short-term rental-booking sites should be held liable for crimes involving its users or listings, Bloomberg reported.
Many cities have introduced regulations aimed at Airbnb and its competitors in recent years, and Airbnb has devoted additional resources to keeping users safe. But, Bloomberg said, as with Uber, Lyft, and other "platform" companies that initially skirted regulations as they grew rapidly, being able to obscure the extent of safety issues from public view has left regulators lagging far behind.
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