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Inside the Rise and Fall of a Multimillion-Dollar Airbnb Scheme

The plot was geared toward getting around city regulations that are intended to keep blocks of apartments from being turned into makeshift hotels that avoid lodging taxes and oversight.

The legal battle drags on, and Mayor Bill de Blasio announced this week that the city had issued a subpoena for information on 20,000 home-sharing listings in New York. The mayor and other politicians have argued that Airbnb listings diminish the supply of apartments available to full-time renters, making the city’s affordable housing crisis even worse.

Airbnb has clashed with other cities. Los Angeles, Amsterdam, Paris and Vancouver, British Columbia, have all passed laws restricting Airbnb rentals. In July, Palma de Mallorca became the first city in Spain to ban Airbnb.

In all, more than 100 Airbnb host accounts and 18 corporations were created to run an illegal hotel business that stretched north from TriBeCa to SoHo, Gramercy, the Upper East Side and Harlem, according to a lawsuit brought by the city.

Christian Klossner, the executive director of the Mayor’s Office of Special Enforcement, which led the investigation, said his office was “here to preserve housing for New Yorkers and to make sure both New Yorkers and visitors are kept safe and treated fairly.”

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