(Long Island, NY) Attorney General Eric T. Schneiderman today published an op-ed in the New York Times. The following are excerpts from the op-ed:
ON COOPERATION BETWEEN REGULATORS & THE TECH INDUSTRY: Just because a company has an app instead of a storefront doesn’t mean consumer protection laws don’t apply. The cold shoulder that regulators like me get from self-proclaimed cyberlibertarians deprives us of powerful partners in protecting the public interest online. While this may shield companies in the short run, authorities will ultimately be forced to use the blunt tools of traditional law enforcement. Cooperation is a better path.
ON NEW YORK’S ILLEGAL HOTEL LAW: In 2010, the State of New York passed a law confirming that short-stay rentals were generally illegal in apartment buildings, and for good reason: The longstanding distinction between hotels and apartment buildings protects the rights of building residents who didn’t choose to live 10 feet away from a parade of strangers. The law also protects tourists — who are usually unfamiliar with the rooms and buildings where they are sleeping — by imposing stiffer fire safety and building codes on hotels.
ON OUR CASE AGAINST AIRBNB: Airbnb “hosts” rent out apartments every day in violation of this law. Some of these are large, commercial enterprises with dozens of apartments — truly illegal hotels … When my office reached out to Airbnb, the company rejected the idea of self-policing out of hand and refused to provide data that would give us a handle on the scope of the problem. With my hope of working in partnership with Airbnb dashed, we were forced to subpoena the company for information, a step that Airbnb has attempted to quash in court. On Monday, just 24 hours before a key court date, Airbnb announced it had removed some 2,000 New York-based listings from the site, suggesting that our concerns are not misplaced.
ON THE PRECEDENT FOR COOPERATION: Last year, my office discovered that the consumer review website Yelp was being flooded by companies hired to fraudulently inflate rankings for clients and hurt those clients’ competitors. Rather than taking a knee-jerk anti-regulatory stand, Yelp, a publicly traded company, decided to cooperate with law enforcement on a yearlong undercover investigation that resulted in fines against 19 of these companies. This furthered the public interest, but also burnished Yelp’s reputation for reliability.
ON THE NEXT STEP: Regulators should not be deterred and, as a practical matter, they can’t and won’t be — we are now living in an online world, one that offers great promise but is also becoming one of the primary crime scenes of the 21st century. Major service providers cannot be allowed to treat it as a digital Wild West. The only question is how long it will take for these cybercowboys to realize that working with the sheriffs is both good business and the right thing to do.
The full op-ed by Attorney General Schneiderman can be read here.
