Woman allegedly raped at New York Airbnb received secret $7m settlement – report

An Australian woman who was allegedly raped at knifepoint in an Airbnb apartment in New York received a secret settlement of $7m which included restrictions on what she could say about the incident, according to a media investigation into the vacation listings giant’s “guest safety” policies .

The 29-year-old was attacked in a property near the tourist magnet and central Manhattan crossroads of Times Square early on New Year’s Day in 2016, Bloomberg Businessweek reported, prompting the swift intervention of a dedicated Airbnb crisis management “taskforce”.

The team, according to Bloomberg, “cleans up only after disaster strikes” and in this case relocated the woman to a hotel, paid for her mother to fly from Australia, then returned the pair back home with travel, health and counselling costs covered.

The subsequent settlement, the article claims, was among the biggest ever paid by the $90bn company, which it said routinely spends tens of millions of dollars each year legally to resolve with customers such incidents with potentially negative public relations consequences. It also deals with problems such as the need to compensate Airbnb property hosts for damage caused by renters.

Under the terms of an agreement negotiated with Airbnb by the woman’s New York attorney, and paid out two years after the incident, she was prohibited from discussing it, suing the company or implying that Airbnb held “responsibility or liability” for the attack.

In an email to the Guardian, Airbnb denied it had attempted to muzzle the woman. “In sexual assault cases, in the settlements we’ve reached, survivors can speak freely about their experiences,” spokesperson Benjamin Brait said.

He did not dispute other details of the Bloomberg report, but added that Airbnb’s “trust and safety” team was an open and integral part of its overall customer support operation.

“The priority for our company and our executives was supporting the survivor and doing right by someone who had endured trauma,” he said.

“Our safety team worked hard to support the survivor following the horrific attack. We proactively reached out to NYPD [the New York police department] after the attack to offer our assistance for their investigation.”

Jim Kirk, the woman’s lawyer, declined comment, telling the Guardian in an email that “we don’t have anything to add to the Bloomberg piece”. He said his client wished to remain anonymous and was turning down all media interview requests.

The victim and several friends had rented the apartment, one of four in the 12-apartment midtown Manhattan property that was listed on the Airbnb website, for a new year’s celebration. According to police records seen by Bloomberg, she returned to the property alone and was attacked by a man with a knife who was hiding in the bathroom.

The alleged rapist, who is in custody awaiting trial, was caught by police an hour later. He had allegedly returned to the building with a knife, one of the woman’s earrings and duplicate keys to the apartment.

It is unclear how he had the set of keys, the report said, but the women told police they had picked up their own set, without being asked to provide identification, from a local convenience store, per the check-in instructions from the booking’s host.

At the time of the incident, Airbnb was embroiled in a dispute with New York City authorities over the regulation of short-term rentals of private homes. Company officials, Bloomberg said, were concerned that negative publicity over the alleged rape had the potential to affect the success of its operations.

A document seen by Bloomberg purports to show that Airbnb pays about $50m annually to hosts and guests, which includes damage to property and legal settlements.

The investigation by the news organization looked into a number of incidents, including the murder of a Miami woman in Costa Rica by the security guard of the Airbnb property at which she was staying, a case the company settled, without admitting liability.

In another incident, reported by the Guardian in 2017, a New Mexico woman claimed to have been sexually assaulted by a “super-host” whose property she had rented.

That woman’s lawyer, Teresa Li, settled the case for an undisclosed amount before it went to trial. She told Bloomberg that such settlements make it difficult for courts to decide the extent to which internet listing companies are liable for crimes committed at their properties.

“Everything is getting sent to arbitration so nobody really knows,” she said. “The only thing that really motivates [Airbnb] is the threat of bad PR or a nightmare in the press.”

Shares in Airbnb, which launched as a public company on the Nasdaq stock exchange in New York in December, fell by more than 3% on Wednesday after the Bloomberg report was published, before rising again in the afternoon.

The company, founded in 2008 by entrepreneurs Brian Chesky, Joe Gebbia and Nathan Blecharczyk, grew to dominate the internet vacations listings market, but lost almost 80% of its business in eight weeks last year as the Covid-19 pandemic wiped out travel in and between many countries, leading to the laying-off of a quarter of its workers.

Last August it announced it was banning house parties and restricting guest numbers at its properties worldwide in response to criticism over rowdy lockdown gatherings.