The Tribeca Citizen uncovered a mysterious network of non-existent restaurants with profiles and menus on Seamless
A hat tip from an observant New Yorker lead to the discovery that several restaurants on Seamless are fake.
UPDATE: GrubHub Seamless has removed the profiles of the fake restaurants, and has issued the following response:
"At GrubHub Seamless, the customer experience is our top priority. We took immediate action as soon as we were made aware of the situation, and the disputed restaurants have been removed from our services.
GrubHub Seamless takes measures and has protocols in place to ensure the authenticity of restaurants represented on our services -- including visiting restaurants in person to confirm they are legitimate establishments. In this rare occurrence, a few restaurants were not detected by our teams. We are taking the opportunity to review and strengthen these protections and encourage diners to report inaccuracies to our customer care team to ensure an optimal dining experience."
The Tribeca Citizen has uncovered several profiles of fake restaurants on Seamless and GrubHub (which merged in 2013) that appear to be part of a quiet monopoly on Chinese food delivery in downtown Manhattan.
A New York City resident noticed that a new restaurant on Seamless called Joe’s Noodles listed its physical address as 121 Reade Street, currently the Tribeca Abbey apartments. The Tribeca Citizen discovered that the phone number listed was linked to another restaurant that doesn’t exist, called AAA Asian Food at 325 Broadway.
AAA Asian Food’s website reveals a sparkling banner for another restaurant called Asian Diet Food. Along with the fake listing on Broadway, Asian Diet Food’s nonexistent address is on John Street.
Finally, the Tribeca Citizen called the listing for ‘Asian Diet Food’ to ask the location of the actual kitchen that was producing all this mysterious food. The answer, 31 Oliver Street, reveals that Lily’s Japanese & Chinese Restaurant appears to filling all the delivery orders placed online.
GrubHub Seamless’ director of PR wrote to Tribeca Citizen, "As I write this email, our team is taking steps to correct the situation. GrubHub Seamless takes measures to ensure that every restaurant is correctly represented on our services and invites diners to report inaccuracies to our customer care team."
Karen Lo is an associate editor at The Daily Meal. Follow her on Twitter @appleplexy.
Why Grubhub Created Its Own Websites for Restaurants
When it rains, it pours, and for Grubhub, it’s been hurricane season. Over the past few months, the online ordering platform has been accused of charging restaurants with unwarranted phone fees, leading to a potential class-action lawsuit and an invite to appear before the New York City Council. That issue seems to have led to more digging, and last week, a new controversy arose: that Grubhub was creating ke” websites for the restaurants they work with.
Robbing restaurants of fees and generating illicit websites seems a bit gratuitously evil for one of the largest companies in a still extremely competitive online ordering industry where pissing off your partners probably isn’t good for your long-term business prospects, so clearly there are two sides to this story. As reported by New Food Economy — the site that broke the websites story — as far as fees are concerned, Grubhub has said the onus is on the restaurant to make sure they aren’t being mischarged. Apparently, there’s a similar story behind the ke” websites as well.
I’ve been putting the word ke” in quotes because these websites are very real. Grubhub set them up as a place where people can find the restaurant online and then place an order through Grubhub. Frankly, a free website doesn’t sound like a bad deal until you understand how Grubhub’s commission structure works: The company gets a bigger cut depending on how an order was generated, and ostensibly, an order coming through a website created by Grubhub could result in a higher commission than one placed elsewhere. Along those lines, the bigger issue is when the Grubhub-created site is competing directly with an “official” site created by the restaurant itself. In those instances, Grubhub can be poaching business (again, potentially at a higher fee) from the restaurant they’re supposed to be helping. Making the whole thing look even more suspicious, though the Los Angeles Times reports that Grubhub does reserve the right to create these “microsites” in their contracts, at least some restaurant owners say they didn’t know it was happening.
Still, in Grubhub’s defense, you can see why the company would want to create websites for restaurants that don’t have one. And Grubhub Chief Executive Matt Maloney sent a five-point email to employees (which was obtained by the Times) calling the whole thing lse narratives.” His argument: The permission to make the sites was “very clear,” and the sites generated more sales with actually lower commissions than those charged elsewhere. He also stressed that these domain names would always be turned over to the restaurant owners free of cost if requested. And finally, he added that Grubhub had stopped this process last year anyway. “These orders made very little money for us and in many cases we lost money,” he said at one point.
Overall, it would seem like both sides have valid points here. So whether these “microsites” are truly as devious as some have made them out to be is up for interpretation. And yet, in light of Grubhub’s phone fees issue — where the company has actually been refunding significant chunks of money to some restaurants — it’s also easy to see why owners might suddenly question everything that Grubhub has been doing without their explicit knowledge, regardless of what the intentions may be.
Grubhub Is Suspiciously Adding Restaurants That Don't Do Delivery
A tweet from the owner of a Michelin-starred restaurant led other restaurateurs to discover they were also on the platform without permission.
The explosion in online restaurant delivery has come with plenty of growing pains: Restaurants have complained about being overcharged, customers and drivers have questioned tipping policies, and the services themselves have come under government scrutiny. And that’s just scratching the surface. Here’s another topical issue: food being delivered without consent.
In theory, some may say what’s the big deal if someone picks up and In-N-Out order on your behalf? But when this actually happened, the burger chain argued that these kinds of unauthorized deliveries can ruin the brand’s reputation since they have no quality control over the operation. And that’s just fast food burgers. Imagine if this was happening with a Michelin-starred restaurant? As it turns out, it was𠅎ven though the restaurant didn’t offer takeout at all𠅊nd now, more restaurants are coming forward with similar complaints.
Over the weekend, Pim Techamuanvivit turned to Twitter to vent her frustration about an incident at her San Francisco-based Thai restaurant Kin Khao. In a string of eight posts, she explained what happened. 𠇊t 8.30pm I answered the phone, someone called to ask about their delivery order that was placed 45 minutes ago. Perplexed, I told him we didn’t do delivery, not even take-out. He said what were you doing on [delivery platform Seamless] then?”
In her tweets, Techamuanvivit clarified that her restaurant had never been on Seamless. "He sounded really confused, so we said goodbye and I hung up the phone,” she continued. “Then I got a little curious, so I went into the office and googled ‘kin khao delivery’, and guess what came up.” The answer: Not only was her restaurant on Seamless, but also Grubhub (which owns Seamless), and Yelp. Furthermore, as the San Francisco Chronicle points out, the menus on these sites were wrong, too, including items the eatery doesn’t even offermittedly a moot point since Kin Khao doesn’t even do takeout, let alone delivery.
“It’s outrageous,” Techamuanvivit told the paper. “They can’t get away with this. They can’t totally fake a restaurant that doesn’t do delivery and go pick up food from, I don’t know, some rat-infested warehouse somewhere and deliver to my guests.”
In the wake of this news, Grubhub has said they’re happy to remove any restaurant that doesn’t want to be on their site. And they responded to the Chronicle by stating, “Kin Khao was one of these restaurants we added to our marketplace for this initiative to include more restaurants on our platform, and unfortunately, we referenced the incorrect menu for this restaurant. As soon as they reached out to us expressing they𠆝 like to be removed and flagged the incorrect menu, we honored the request. They are no longer on our marketplace.” For her part, Techamuanvivit mentioned a potential lawsuit.
Meanwhile, Kin Khao isn’t the only San Francisco restaurant facing this dilemma. Adam Mesnick, owner of the sandwich shop Deli Board—which also doesn’t do delivery—provided a very similar tale to the SF Gate: confused delivery drivers working with outdated menus. Mesnick reportedly told the paper that Techamuanvivit’s tweet helped tip him off to the root of the problem. “It’s time-wasting, and it’s someone’s job,” he told the Gate. “It really creates so much confusion for the workers.”
Frankly, it seems like this policy could create a lot of confusion for diners too. It’s frustrating enough when an order is slow to arrive it would definitely be more annoying to find out that the order you just ordered delivery from doesn’t even do delivery! And if we have to call to confirm that a restaurant really offers delivery at all, what’s the point of going through an app to begin with?
Some apps slap bogus phone charges on restaurants
When a restaurant gets into a partnership with Grubhub, the app owns the rights to create microsites that look like, and have the same content as the restaurant's original website. As of June 2019, the company has registered more than 23,000 web domains (via The Counter). The phone number listed on the new site created by the app is not the restaurant's actual number, though. It is Grubhub's number, which when a customer calls, is redirected to the restaurant. The company gets a marketing commission, even if the call did not lead to an order.
The New York Post reports that an Italian restaurant in Brooklyn was charged $9.07 by Grubhub for answering a customer's phone query of whether gluten-free pasta was available at the eatery. Another Mediterranean restaurant in Manhattan was charged $9 by Grubhub for informing a customer who called that the restaurant was closed. Restaurants have complained that the food delivery giant has been charging them for calls that involve general questions, dinner reservations, complaints about food, and even phone calls that went to voicemail!
According to Eater, Grubhub uses an algorithm to determine whether or not the call leads to a food order. These recordings are made available to restaurant owners, but the algorithm is far from perfect and numerous restaurants have discovered erroneous charges. For example, in June 2019, Grubhub ended up refunding $10,000 to a New York restaurateur who accused them of charging bogus fees.
"Ghost" Restaurants Are Haunting Seamless
The endless Seamless scroll is a daily ritual for most of us. Selecting one of the dozens—if you're lucky—restaurants on their site can often take nearly as long as making the damn meal yourself—and some conniving restaurateurs have found a way to exploit that bounty by creating fake or "ghost" restaurants to increase a customers chances of ordering from them.
An investigation by NBC New York discovered that 10% out of the 100 restaurants they searched via Seamless and GrubHub were found to be ghost restaurants. A restaurant listed as Really Chinese advertised their location on 31st Street yet the listed address was one for a private residence, not a restaurant. According to the delivery person, the food was actually being prepared at Abby Chinese, located four blocks away.
Gary Chen, owner of Abby Chinese, says it's common for restaurants to employ this practice to stay competitive in a flush market. "When we have one line, it's hard to compete," Chen explained. “We know how many lines some of the other restaurants have. It's an open secret." In fact, last year Tribeca Citizen uncovered a similar practice, whereby one restaurant kitchen was listed under multiple names on the Seamless website.
"Some people might be illegally operating from their apartment, from their home, and delivering to people in complete contravention to department of health regulation," said Julie Menin, Consumer Affairs Commissioner, whose office reportedly encounters this issue regularly. For its part, GrubHub says it "take[s] the accuracy of our restaurant listings seriously" and will work with the DCA on an exorcism.
Update A representative for GrubHub tells us the restaurants mentioned in the story above have both been removed from the Seamless listings. The company also released the following statement:
Millions in commissions investigated
At a recent hearing in New York City Hall, GrubHub executives estimated the company made $30 million in phone commissions last year alone. According to New Food Economy, the commission system uses an algorithm to find out whether a phone call resulted in an order. But the system is prone to costly mistakes.
GrubHub states that its restaurant partners can log into the back end of its site and listen to all phone recordings to make sure they aren’t being charged for calls that didn’t result in orders. The owner of one small restaurant did just that and found that GrubHub owes her about $30,000 in commission overcharges.
GrubHub issued this statement in response to the New Food Economy report:
“GrubHub has never cybersquatted, which is identified by ICANN (Internet Corporation for Assigned Names and Numbers) as ‘generally bad faith registration of another person’s trademark in a domain name.’ As a service to our restaurants, we have created microsites for them as another source of orders and to increase their online brand presence.
‘Additionally, we have registered domains on their behalf, consistent with our restaurant contracts. We no longer provide that service and it has always been our practice to transfer the domain to the restaurant as soon as they request it.”
Seamless Will Now Verify That Their Restaurants Are Real, Which Is Probably Good.
In the wake of an extremely distressing report which found that Seamless and GrubHub restaurants often use unregulated “ghost kitchens,” the company has officially changed its policies.
The websites, which fall under the merged umbrella of Grubhub Seamless, will now verify restaurants listed to make sure they exist and have been inspected by the health department, according to NBC New York.
In a new particularly alarming segment, the local news channel found that at least six different restaurants were operating out of one address—146 E. 44th Street—which appears to be an office building labeled Green Summit Group. It’s a commercial kitchen, an important distinction, since commercial kitchens don’t receive inspection grades and aren’t allowed to sell directly to customers.
Before the implementation of the new rule, it was reportedly common for restaurants to advertise under several fake names and phone numbers in order to increase the chance of a consumer picking their business.
“When we have one line, it’s hard to compete,” said Gary Chen, manager of Abby Chinese (and the fake Really Chinese). “We know how many lines some of the other restaurants have. It’s an open secret.”
Update: In an email to Jezebel, a representative from Seamless noted that Really Chinese and Abby Chinese have both been removed from the website and the restaurants under the Green Summit Group umbrella have refiled under the proper classification. The representative also provided the following statement:
Grubhub - DoorDash - Seamless Delivery Service Fraud
Last night Pim Techamuanvivit discovered that Grubhub, Seamless and Yelp delivery services have fake listings for her San Francisco restaurant, Kin Khao, to accept food orders on their sites. Her restaurant does not fulfill the food for these orders. And DoorDash has a fake listing for her other restaurant, Nari.
With the growth in meal delivery business, many restaurants have shifted their take-out business fulfillment to ghost kitchens. The food that delivery customers receive from them is not produced in their restaurant kitchens and may not be the same.
Now with counterfeit pages on delivery sites, consumers have one more level of fraud to watch for.
Edited to add:
Tara Duggan of SF Chronicle is covering the tale.
Pim Techamuanvivit on Twitter
“If you want to hear another story about how @seamless @grubhub, and @yelp are defrauding us restaurants and their customers, pull up a chair. I have.
Nosy Neighbor: How Many Fake Restaurants Are on Seamless?
I noticed a new Chinese restaurant on Seamless called Joe’s Noodles. The address is 121 Reade Street next to Hudson. I haven’t walked by yet but that address appears to be the Tribeca Abbey apartment building. Do you have any idea what’s going on? Is the restaurant on Seamless just a front for another location? —Archie
If you’ve ever wondered whether all the Chinese food delivery in the city comes from one kitchen, or how on earth there could be so many Chinese restaurants in FiDi, this post is for you.
Joe’s Noodles is on Seamless, GrubHub, Menu Pages, et al, with 646-301-4010 as a phone number. There was no answer when I called at lunchtime. The Joe’s Noodles website listed the same number for ordering, but also 212-729-0499 at the bottom “for other information.” I got a recording saying that the voicemail wasn’t activated. So I Google searched the number, and what came up was AAA Asian Food at 325 Broadway. Clicking through to AAAasianfood.com, however, led to a home page with “Asian Diet Food” as the restaurant’s name—and more confoundingly, it listed two locations: 325 Broadway and 5600 N. Clark St. in Chicago (with the phone number 212-233-3915).
I called the number for 325 Broadway (212-233-7447), but it was busy. 325 Broadway is the same address as Arome Cafe, so I was wondering if the kitchen there was pumping out Chinese food—but they had no idea what I was talking about.
Then I noticed that on AAAasianfood.com’s “location” page, Asian Diet Food is listed as a sister restaurant at 70 John. I called that number (same as the Chicago one, 212-233-3915): “You want to order?” replied the person to each of my questions, so I asked for the owner—who confirmed that the food from “Joe’s Noodles” and “AAA Asian Food” comes from their kitchen.
Only after I hung up did it occur to me to use Google Street View to see if there actually is an Asian Diet Food at 70 John—and from what I can tell, there isn’t. And when you Google John NYC,” you also get a restaurant called Joe’s Dumpling….
The question remained: Where is the actual kitchen for the false fronts listed online at 121 Reade, 325 Broadway, and 70 John?
I called Asian Diet Food ( John”) again and asked: Where is the kitchen? The answer: 31 Oliver Street. So I Googled that, and now we know: Lily’s Japanese & Chinese Restaurant is the source of all this food. The only question that still remains is how many more restaurants on Seamless and the like are fronts for it or other establishments. (Forget it, Jake….) Actually, there’s one more question: Is GrubHub Seamless (it’s one company now), which certainly benefits from showing restaurant growth in the period before it goes public, aware and/or complacent about the issue?
UPDATE: “I wanted to thank you for calling this to our attention,” emailed Abby Hunt, GrubHub Seamless’s director of PR. “As I write this email, our team is taking steps to correct the situation. GrubHub Seamless takes measures to ensure that every restaurant is correctly represented on our services and invites diners to report inaccuracies to our customer care team.”
Got a question? Email it to [email protected]
GrubHub Seamless Cracks Down on Restaurants Accused of Gaming Their Online Menu System
Some restaurant owners seemed to have cracked the code for more attention.
Feb. 25, 2014 -- If that takeout order tastes familiar, it could be because restaurateurs are listing their business under different names on online menu websites GrubHub and Seamless, with the apparent intent of reaching more customers.
The Tribeca Citizen website first reported that Joe's Noodles, a New York City restaurant listed on Seamless, had the same phone number as AAA Asian Food, whose website indicates it has a location in Chicago and Manhattan.
Joe's Noodles didn't respond immediately to a request for comment from ABC News.
In an apparent example of online menu gaming, it turns out five ostensible New York restaurants listed on Seamless were getting their food from one place: Lily's Japanese and Chinese Restaurant, the Citizen reported. Lily's Japanese and Chinese Restaurant did not respond to a request for comment from ABCNews.com. Another restaurant called Asian Diet Food was listed as a sister restaurant on AAAasianfood.com's website at 70 John Street downtown. The Google street-level photo shows a Citibank ATM at that location.
Andy Lin, owner of Lily’s in New York City, told ABCNews.com the mix-up was likely related to the previous owner of the restaurant. Lin said he bought Lily’s about one month ago, and he has owned another business called Beijing Restaurant in Danbury, Conn., for about five years.
“I don’t know what the other owner was doing,” Lin said.
A spokeswoman for GrubHub Seamless, which completed their merger last August, said the company has caught restaurants trying to do this before, but only a handful of times in their 15 years of operation.
Last week the Wall Street Journal said GrubHub Seamless filed confidentially for an initial public offering, which is permitted as a smaller company under the JOBS Act, but the company has not confirmed that report.
"We took immediate action as soon as we were made aware of the situation, and the disputed restaurants have been removed from our services," said Abby Hunt for GrubHub Seamless of the businesses listed by the Tribeca Citizen, except for Lily's Japanese and Chinese Restaurant.
On Seamless.com, a search for Joe's Noodles in New York City today yielded the message: "Bummer! Joe's Noodles (Reade St) (121 Reade Street, New York City 10013) is no longer active on Seamless."
In a statement, GrubHub Seamless says it has steps in place "to ensure the authenticity of restaurants represented on our services -- including visiting restaurants in person to confirm they are legitimate establishments."
"In this rare occurrence, a few restaurants were not detected by our teams. We are taking the opportunity to review and strengthen these protections and encourage diners to report inaccuracies to our customer care team to ensure an optimal dining experience," the statement read.