Personal Finance

This growing travel scam has cost consumers nearly $4 billion

Key Points
  • Online hotel booking scams are on the rise, according to the American Hotel & Lodging Association.
  • Last year, travelers made 55 million bookings through websites that turned out to be a rogue third-party operator.
  • To avoid these fraudsters, book directly, plan ahead and always pay with a credit card.
Haveseen | Getty Images

Carefully scrutinize that holiday getaway deal before you book. If a travel sale seems too good to be true, chances are it probably is.

Online hotel booking scams are on the rise, warns the American Hotel & Lodging Association.

Last year, the industry group reports, consumers made 55 million bookings through websites they thought belonged to a hotel — but later realized was actually a rogue third-party operator. That's more than triple the number of fraudulent bookings reported in 2015.

The damage to consumers: Nearly $4 billion in misleading bookings.

This "mirror site" deception, where misleading webpages purport to be a company they're not, is among the most popular online travel scams, said Maryam Cope, vice president of government affairs at AHLA. Rogue sites can be tricky to spot since they often use the resort's name in the link, set up fake phone numbers, buy ad words, and cover the webpage with real photos of the hotel and its logo.

Scammers buy diamond necklaces with your credit card
Scammers buy diamond necklaces with your credit card

But consumers should be on the lookout for more than just sneaky sites, said Katherine Hutt, a spokeswoman for the Better Business Bureau.

"When it comes to travel scams and other high-end, high-cost scams, you're more likely to have the scammer reach out to you," she said.

Most times, scammers reach out over email, but sometimes they'll call, too, she said. In this instance, the scammer pretends to be calling from a well-known hotel company to notify you of a hot deal that's about to expire. Typically, they'll say something like, "there's only one room left" or "there's someone on the other line," she said — anything to get you to buy right then and there.

This kind of urgency should be an instant red flag, warns Hutt.

"They want to put pressure on you because they don't want you have time to do your research and ask around," she said.

Hottest last minute travel deals: Hotel Tonight CEO
Hottest last minute travel deals: Hotel Tonight CEO

Avoiding a scam

To steer clear of travel scams, the research stage of the booking process is necessary, especially if going through a third-party source, Hutt said. Here's how to do your due diligence:

  • Purchase from the source. Whenever possible, book directly with the hotel instead of a third-party source. This is the safest way to be certain your reservation is legitimate, said Katherine Lugar, president and CEO of AHLA. If you're worried about the possibility of a mirror site, Cope recommends calling the company and asking specific questions like, "What's nearby? What amenities does the hotel offer?" If they're unable to produce an answer quickly, you may not be dealing with who you think you are.
  • Use reputable and secure third-party sources. There are plenty of reputable third-party booking sites and travel agencies "that have relationships with hotels where you can safely book travel," said Hutt. lets consumers check that the site or agency has a good reputation with previous customers. Additionally, confirm that the website is secure by checking for a lock symbol in the web address and a URL starting with "https."
  • Plan ahead. The best hotel deals are often available far in advance. Planning ahead will give you time to research different sites, compare options and amenities and lock in a good rate.
  • Pay with a credit card. Always pay with a credit card, which offers more protection than debit cards, wire transfers, cash and other payment methods. The worst thing you can do is pay with a debit card, said Hutt. "You may give access to all the money in your bank account," she said.

What to do if you're victimized

If you fall prey to a travel scam, Hutt and Cope agree the best first step is to alert your credit card company. Sometimes, they're able to reverse the charges. Don't get your hopes up though — travel and vacation scam victims lose an average of $847, said Beverly Baskin, president and CEO of the Council of BBB.

The next step is to file a complaint with the state attorney general — in both the state you're traveling in and the state you're from — said Cope. If you're traveling abroad, file a complaint with the federal trade commission.

Victims may also consider filing a police report if a substantial amount of money was lost, Hutt said.

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