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A rental listings platform allegedly took advantage of renters seeking affordable housing by luring them into paying to see fake apartment listings, according to a lawsuit filed by the Federal Trade Commission and six state attorneys general, including Attorney General Maura Healey.
The lawsuit claims New York City-based Roomster took over $27 million from consumers, including students and poor renters, who the company targeted for its services. Roomster’s website and mobile apps charge customers fees to view listings for full apartments, room rentals, sublets and roommate requests but did not actually verify the listings, the lawsuit alleges, contrary to its claims that it did. The lawsuit also claims the company paid for “tens of thousands” of fake reviews on fake listings in order to dilute real reviewers who sought to warn off other Roomster users.
The lawsuit, filed in the Southern District of New York, also names Roomster co-owners John Shriber and Roman Zaks and seeks unspecified monetary damages.
“We are alleging that this company willingly took advantage of potential tenants, knowing that these individuals were vulnerable and in need of affordable housing, for their own financial gain,” Healey said in a statement. “My office is working with our federal and state partners to hold this company accountable and to protect residents from further harm.”
