LOS ANGELES — Two San Fernando Valley men pled guilty to charges of false advertising, illegal tenant lockout and utility shutoff in relation to a Santa Monica vacation rental scam, city attorneys announced Monday.
Eran “Ron” Shabtay, 43, and his brother Yerev “Reeve” Shabtay, 42, admitted Sept. 18 to misleading tourists who rented their two Santa Monica properties from 2010 to late 2012.
After paying in full by credit card to rent units at 2618 Second St. and 138 Pacific St., customers arrived to find the situation quite different from what had been advertised on vacation rental websites Vrbo.com and Homeaway.com.
“There were a wide variety of problems from the very beginning, starting with the ads themselves, which misrepresented the properties and sometimes even the addresses of the properties,” said Adam Radinsky, head of the Santa Monica Consumer Protection Unit.
“Many of the victims reported that when they arrived in town, they weren’t able to find the property because the address had been wrong and the defendants refused to communicate with them — they were unable to reach anyone.”
In a two-year span, 17 individuals filed complaints with the Santa Monica City Attorney’s Office concerning the Shabtay’s management.
Seven of the victims were international, said Radinsky, and came from as far away as Norway, Australia and England.
Customers alleged that their credit cards had been charged incorrectly, the properties were smaller than advertised and in poor condition, properties had been double-booked and that the Shabtays refused to refund their money or return calls.
“Other people reported that when they were able to reach somebody on the other end, they were given a run-around or were blamed for … problems that were not their fault,” said Radinsky.
The City Attorney’s Office ultimately filed criminal charges against the men last November.
Although the short-term rental of residential property is illegal in Santa Monica, the men were not prosecuted for breaching that law.
Under the terms of their convictions, the Shabtays face a slew of penalties and hefty fines.
Each man must perform between 80 and 104 hours of hard labor and 100 hours of community service.
They are responsible for paying more than $23,000 to complete the refunds of all customers in the case who have not already received credit card reversals, as well as $30,000 to Santa Monica’s Consumer Protection Fund.
Additionally, the Shabtays are placed on four years’ probation and are prohibited from doing any short-term rentals in Los Angeles County again.
“False advertising is a serious crime,” Radinsky said. “It cheats consumers and it gives dishonest businesses an unfair advantage over honest ones. Consumers need to know that they can trust what is promised to them, including online ads.”