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Hotels Warned About Deceptive Price Quotes
Washington, DC: Hotel operators that provide "deceptively low pricing"on their online reservation sites are being warned by the Federal Trade Commission that they may in violation of the law for consumer fraud.
The FTC issued warning letters in 2012 to 11 hotels citing consumer complaints that surfaced at a conference the FTC held on "drip pricing,"a pricing technique in which firms advertise only part of a product' price and reveal other charges as the customer goes through the buying process.
According to the FTC letters, "One common complaint consumers raised involved mandatory fees hotels charge for amenities such as newspapers, use of onsite exercise or pool facilities, or internet access, sometimes referred to as 'resort fees.' These mandatory fees can be as high as $30 per night, a sum that could certainly affect consumer purchasing decisions." The warning letters also state that consumers often did not know they would be required to pay resort fees in addition to the quoted hotel rate.
Specifically, consumers complained that they did not know that they would be required to pay resort fees in addition to the quoted hotel room rate. Several stated that they only learned of the fees after they arrived at the hotel, long after making a reservation at what they believed to be the total room price. Others paid for the reservation in advance, and only found out after they arrived at the hotel that they would have to pay additional mandatory fees.
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The FTC issued warning letters in 2012 to 11 hotels citing consumer complaints that surfaced at a conference the FTC held on "drip pricing,"a pricing technique in which firms advertise only part of a product' price and reveal other charges as the customer goes through the buying process.
According to the FTC letters, "One common complaint consumers raised involved mandatory fees hotels charge for amenities such as newspapers, use of onsite exercise or pool facilities, or internet access, sometimes referred to as 'resort fees.' These mandatory fees can be as high as $30 per night, a sum that could certainly affect consumer purchasing decisions." The warning letters also state that consumers often did not know they would be required to pay resort fees in addition to the quoted hotel rate.
Specifically, consumers complained that they did not know that they would be required to pay resort fees in addition to the quoted hotel room rate. Several stated that they only learned of the fees after they arrived at the hotel, long after making a reservation at what they believed to be the total room price. Others paid for the reservation in advance, and only found out after they arrived at the hotel that they would have to pay additional mandatory fees.
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