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Airbnb fights NY attorney general's subpoena

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Renting out someone's apartment is an easy way to get an inexpensive place to stay if you're a tourist, and cheaper and more convenient than most hotels. But now the government is stepping in and trying to get a handle on a booming business that may not be playing by the rules.

State Attorney General Eric Schneiderman is squaring off in court with multi-million dollar Internet company Airbnb.

Airbnb advertises places to stay in 34,000 cities in 192 countries. But what it is doing in New York City has officials on alert. The popular site lists everything from a bunk bed for $22 to an entire luxury apartment for five figures. You can book whatever you like, as long as you'd like, just like any travel site. Airbnb tells us it is a way for apartment dwellers to make extra cash, and give tourists affordable options. But the attorney general says it violates state housing law that bans sublets of less than 30 days.

State Sen. Liz Krueger says that in the city's super tight housing market, it puts city residents at a disadvantage.

Schneiderman estimates that two-thirds of the nearly 40,000 rentals are illegal. While Airbnb portrays the renters as individuals, the AG says some are speculators cashing in, with one company listing 134 different apartments. Because Airbnb is an Internet company, it's not even clear if local laws apply.

A federal crackdown could be in the future, says Rep. Charles Rangel.

The neighbors of those renting on Airbnb can be in for surprises and safety concerns, say community activists. Reports of brothels, late-night parties, front doors left open, and overcrowding can create havoc with New Yorkers' everyday life, says Tom Cayler of the West Side Neighborhood Alliance.

And for parents the risk of transient strangers coming into contact with their children is real, says City Council Member Robert Jackson.

Airbnb says it intends to keep fighting the attorney general's demand for personal information about who is renting out their apartments on the site. Airbnb also says it would like to pay $21 million in taxes if officials would just allow it.

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