FTC Readies Action Against Booking Holdings
The US Federal Trade Commission is preparing to take action against Booking Holdings over hotel ads that send consumers to the wrong site, two sources familiar with the matter told Reuters. One source put the potential penalties at more than $500 million. No complaint has been filed and the FTC has published no figure of its own.
The Reuters wire by Jody Godoy and Doyinsola Oladipo ran on 7 October. The ads appear to direct consumers to a hotel's own site. They deliver consumers to a third-party site instead, where the room often costs more.
Both sources asked for anonymity on the grounds that they were not authorized to speak publicly on the matter.
The Agency Is Examining Guest Reservations
The FTC has been looking into the relationship between Booking and Guest Reservations, a third-party website that advertises stays at specific hotels, the sources said.
The agency is weighing whether Guest Reservations violates the rule against impersonating other businesses. It is considering fee-related violations as well, according to one source.
Guest Reservations has drawn more than 1,000 complaints to the Better Business Bureau. Many of the complainants said they believed they were booking directly with a hotel. They reported surprise fees and customer service representatives who did not respond.
The company says its site uses hotel trademarks or information only to help customers book rooms. It did not immediately respond to a Reuters request for comment.
Booking supplies hotel room inventory to Guest Reservations through Priceline Partner Solutions. Reuters ties that arrangement to an open lawsuit filed by San Francisco.
Ferguson Says Travelers Notice at Checkout
FTC Chairman Andrew Ferguson has put consumer protection at the front of the agency's work. He said the agency has been investigating misleading ad practices in a September interview with Reuters. Ads that lead to sites which appear to be run by hotels are part of that inquiry.
"For tens of millions of Americans, they don't notice until they've checked out and they've paid exorbitant fees," Ferguson said at the Reuters Momentum AI event in Austin.
Ferguson told a Georgetown University event in September that consumer protection cases produce results faster than antitrust investigations.
Booking Told Investors in August
Booking Holdings disclosed the FTC threat in a quarterly filing for the period ended 30 June, filed with the US Securities and Exchange Commission on 4 August 2026.
In July 2026, FTC staff told Priceline that they intend to recommend a complaint against Priceline and a business-to-business affiliate partner, according to that filing. The allegations cover disclosures, fees, customer support and billing practices. Priceline disagrees with the FTC position and remains in discussions to resolve the matter.
A Priceline spokesperson declined to comment. An FTC spokesperson confirmed the investigation and declined to comment further.
The Rule in Play
The rule at issue is the Trade Regulation Rule on Impersonation of Government and Businesses, 16 CFR 461. The FTC published the final rule on 1 March 2024, and it took effect on 1 April 2024.
The agency opened a related rulemaking on 1 October 2026. The proposal covers search engines, social media and other digital marketplace platforms that carry impersonation scams through to consumers. Comments close on 30 November 2026.
San Francisco Sued in July
San Francisco City Attorney David Chiu filed suit on 29 July 2026 against GuestReservations.com and BookOnline.com. The suit names Booking Holdings as the inventory supplier that aided the scheme.
The City Attorney's office says the two sites impersonated real hotels and overcharged travelers by as much as 85 percent. The Better Business Bureau reports more than 1,800 nationwide complaints against the two sites combined. The city seeks restitution for Californians and civil penalties under California's Unfair Competition Law.
The office states that the portals replicate authentic hotel booking pages and use addresses such as "hotelname.bookonline.com," and that some list a phone number with an area code local to the hotel.
Chains Push Direct Booking
Hotel chains route bookings to their own sites. A direct booking avoids the commission and transaction fees that intermediaries charge. Aggregator sites run by Booking and Expedia Group remain a major source of business for Marriott International and Hilton.
A spokesperson for the American Hotel and Lodging Association told Reuters that third-party booking sites which confuse consumers about their hotel affiliations have been a persistent problem for years.
Hilton, Marriott and InterContinental Hotels Group declined to comment on the matter. Hyatt did not respond to a request for comment.
Owners Field the Complaints
Laura Lee Blake is CEO of the Asian American Hotel Owners Association. The association says it represents nearly 20,000 hotel owners in the United States.
Blake said hotel owners and employees often deal with guest complaints when third-party bookings go wrong. She said she made that mistake herself once, booking on a third-party website in the belief that she was booking directly through the hotel.
"If someone who works in the hotel industry can make that mistake, imagine how easily the average traveler can be confused," Blake said.