Published on Thursday, May 3, 2018

San Francisco seeking hefty USD5.5 million fine for couple's illegal Airbnb rentals

The city of San Francisco is seeking a huge fine of $5.5 million for two property owners illegally renting out 14 apartments on Airbnb in a scheme of 'breath taking deceit and fraud.'

The city asked a Superior Court judge to slap the huge fine on Darren and Valerie Lee who own 45 apartments.

It dates back to a lawsuit filed by the city in 2014 alleging the couple illegally converted a building to short-term rentals after evicting tenants.

The Lees agreed to settle a year later and paid $276,000 with an undertaking not to violate short-term rental laws again.

City attorney Dennis Herrera alleges they were soon breaking the law again by listing 14 apartments on Airbnb which were rented out for a combined 2,271 nights, generating more than $700,000.  

The city's motion to the court to enforce the injunction is seeking a penalty of $750 for every day each apartment was available and $1,500 for each day an apartment was actually rented.

That adds up to $5.5 million.

The city's motion alleges the apartments were rented under the names of friends and associates who posed as genuine tenants of the apartments.

When the properties were inspected it was claimed they had been 'staged to appear as if a tenant lived there, but it was obvious that it was a ruse.'

"Every apartment had the same staging: the same Costco food items scattered about, the same arrangement of dirty breakfast dishes in every kitchen sink, same personal products in each bathroom, same damp towels artfully draped over doors as though someone had recently showered," the filing said.

Herrera called out the Lee's 'breath taking greed, fraud and deceit.'

"This couple broke the law, got caught, pledged to stop and then did it again - only this time, with an elaborate ruse to try to hide their tracks," Herrera said in a statement.

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