Drop in Holiday Inn reservations after security breach: franchisees

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A suspected ransomware attack on Holiday Inn crippled the hospitality giant’s ability to book reservations online, leading to steep drops in occupancy that sparked legal threats from franchisees, The Post has learned.

InterContinental Hotels Group, which owns Holiday Inn as well as 15 other brands including Crowne Plaza, said hackers hacked into its systems on Monday, forcing it to shut down its online booking portal.

In response to the hack, which also prevented many customers from booking Holiday Inn rooms on third-party sites such as Expedia and Booking.com, IHG said it was able to resume “intermittent” service on Wednesday.

Some franchisees, however, told The Post that significant disruptions continued to plague the system as early as Friday morning. Customers trying to book rooms can only log on to the Holiday Inn site and make reservations about half the time, according to Vimal Patel, a franchisee who operates Holiday Inn Express hotels in LaPlace, La.

InterContinental Hotels Group, owner of Holiday Inn, said hackers hacked into its systems, forcing it to shut down its online booking portal.
APE
Keith Barr, General Manager of InterContinental Hotels
IHG chief executive Keith Barr said the hack had “significantly disrupted” the company’s online booking, as well as its customer service centers and internal communications.
Bloomberg via Getty Images

As a result, Patel said his hotels were operating this week at less than 50% occupancy, estimating they would be around 75% if the national IHG reservations system was not compromised. For next week, around 20% of its rooms are currently booked – half the normal rate for mid-September, he said.

“Things are supposed to pick up pretty quickly next week,” Patel said, noting that his locations primarily serve business customers.

Rich Gandhi, a Holiday Inn franchisee in Exton, Pennsylvania, reported similar declines in bookings, saying he sent multiple emails to IHG’s operations team and received no response. As a result, Gandhi said he plans to file a class action lawsuit against IHG on behalf of Holiday Inn franchisees in the coming days.

“Franchisees are getting murdered here and IHG doesn’t care,” Gandhi said.

On Tuesday, IHG chief executive Keith Barr said Monday’s hack had “significantly disrupted” the company’s online booking, as well as its customer service centers and internal communications. A day later, Barr said the company’s web and mobile portals had been reactivated, but warned that “services will remain intermittent as we work to ensure the stability of our systems and expect continued disruptions. “.

Representatives for Holiday Inn did not respond to requests for additional comment from The Post.

Gandhi complains that the company’s franchisees – whose hotels make up 71% of its 880,000 rooms worldwide, according to IHG’s 2021 annual report – pay IHG technology fees equivalent to about 2% of revenue. gross business.

“If their computer system is faulty, why are they charging us technology fees?” asked Gandhi.

Patel said he asked IHG this week to be reimbursed for his losses. In response, he says he was told that franchisees are responsible for any loss resulting from security breaches.

“IHG has stated that franchisees will not be compensated in any way,” Patel added. “This risk is part of our franchise agreement.”


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