Expedia Group CEO Peter Kern emailed employees Friday about the discovery of spy cameras in two bathrooms on the company’s Seattle campus — empathizing with their feelings about what he called an abuse of trust by one of their own, and addressing its handling of the incident following internal criticism of its response.
“The news that one of our own colleagues invaded our collective privacy is highly disturbing. It has left many of us angry and feeling vulnerable,” Kern wrote in the internal memo. “There really are no words that I can offer to make those feelings go away for any of us — it has happened despite our vigilant efforts to make sure our people, our Seattle campus, and all our offices are safe places to work and visit.”
A former Expedia Group employee, Marcelo F. Vargas-Fernandez, 42, pleaded not guilty to four counts of voyeurism in connection with the case during his arraignment Thursday in King County Superior Court in Seattle.
The company informed employees Friday that it would be closing the campus from Saturday through Monday, to further enhance its security and detection capabilities. In a separate memo, Kurt John, the Expedia Group chief security officer, attributed the closure to factors including additional evidence obtained by police, while noting that no further cameras have been found beyond those seized in January.
The devices were discovered in December and January. Vargas-Fernandez was arrested Feb. 1. GeekWire first reported about the case Feb. 13. In internal Slack messages published by KIRO Newsradio, and in emails to GeekWire, employees asked why they learned about the incident from news reports, not the company.
“I know that reading incomplete news stories about our team’s significant efforts to protect employees and identify the individual responsible has been frustrating and disappointing during a disturbing time,” Kern wrote Friday.
John wrote, in part, that he and his entire team “understand and share your outrage and anger” over the incident. Expedia Group said previously that the person charged in the incident is no longer employed by the company.
As outlined in the memos on Friday, the company is offering a variety of support services to employees, including resources such as confidential counseling and access to employee assistance programs.
“The best thing we can do now is help the authorities in every way possible, use resources to heal, and learn from this experience to put additional preventative measures in place,” Kern wrote.
Video recording devices were first discovered Dec. 4 in two single-occupancy, non-gender bathrooms on the Expedia Group campus, according to a probable cause affidavit accompanying the charges.
However, “security supervisors made the decision not to take the devices because at the time they thought it was a music device or a battery backup for the soap dispensers,” the affidavit said. Vargas-Fernandez later retrieved the devices, according to a case summary by King County Prosecuting Attorney Leesa Manion.
Expedia contracts with Securitas for security services at its headquarters. The unnamed employee who found a device with a camera lens under the sink in one of the bathrooms in December first tried to report it to a staffer at a security desk, who theorized that the device was related to the soap dispensers, the affidavit said.
“They went back and forth about what it was and she eventually provided [the employee] with a phone number to security. … Security took the information over the phone from [the employee] but seemed hesitant and asked him to call a different number to report the incident. [The employee] told the security person over the phone that he needed to call and take care of it because he was security.”
The employee then discovered a similar device in an adjacent bathroom.
“Confused and yet still alarmed and convinced it was a camera,” the employee felt he had done what he could to report the incident, according to the affidavit.
Two security offers did respond that afternoon, and took pictures of the devices under the sinks before deciding not to remove them, the affidavit said.
The next morning, the employee who discovered the devices went back to the bathrooms, saw that the cameras were gone, and initially assumed security had taken them. He was later dismayed to learn they had not.
A separate email Friday to employees from John did not acknowledge or dispute the police description of the initial reaction from security personnel, but described the company’s response in different terms, saying in part:
“A recording device was discovered in a bathroom during the first week of December. An employee reported the device to the Security team. We started an internal investigation immediately, including checking all restrooms on campus to find any other potential devices. We reported the incident to the Seattle Police Department that week. We also engaged an external private investigation team that included surveillance, forensic and behavioral experts.”
GeekWire has asked SPD for documentation of any report made that week.
John’s memo gave a detailed timeline of the company’s response following the initial discovery in December, including enhanced security measures across Expedia Group’s offices worldwide, multiple daily checks of every bathroom, and the formation of a working committee of experts from a variety of specialties, “to ensure employees were protected and the individual was identified and arrested.”
The prosecuting attorney alleges that Vargas-Fernandez removed the cameras after that initial discovery, then reinstalled them in early January. They were discovered again on Jan. 11, leading to his arrest.
Equipment found in Vargas-Fernandez’s home included at least 33 spy cameras in various forms, 22 SD cards, and six hard drives with at least 20 terabytes of storage capacity, according to an update to the affidavit after his booking. The prosecuting attorney said the state “has cause for concern that there are additional venues where the defendant has illegally placed cameras.”
Expedia Group’s ongoing activities include daily sweeps of single occupancy restrooms, network monitoring for suspicious activities, and the installation of additional security cameras in public areas of the Seattle campus.
“We are conducting continued analysis of this incident and our response for learning and training purposes, and to identify additional proactive security measures for consideration, such as employee training procedures to enhance vigilance and reporting,” John wrote, expressing “deep gratitude to the employee who saw something unusual and spoke up.”
Vargas-Fernandez denied involvement when initially questioned by police, according to the probable cause affidavit. His attorney, Charles R. Varni, has not yet responded to messages seeking comment.
The company is in the midst of a leadership transition, with the announcement Feb. 8 that Kern will be stepping down from the role in May, replaced by Ariane Gorin, currently president of Expedia for Business. Kern is expected to remain Expedia Group vice chairman and stay on the company’s board.
Expedia Group includes brands such as vrbo, Orbitz, Hotwire, Trivago, and Hotels.com, in addition to the flagship Expedia.com. It moved to its expansive campus overlooking Elliott Bay in Seattle in the fall of 2019.
Here is Kern’s email in full:
Dear Team,
I know this has been an incredibly challenging week for our Seattle campus community and those who have visited. The news that one of our own colleagues invaded our collective privacy is highly disturbing. It has left many of us angry and feeling vulnerable. There really are no words that I can offer to make those feelings go away for any of us — it has happened despite our vigilant efforts to make sure our people, our Seattle campus, and all our offices are safe places to work and visit. It happened because one of our own, whom we trusted, abused that trust. Our team identified and fired this former colleague, collaborated with law enforcement to bring them to justice, and gratefully the Seattle Police Department has arrested the individual responsible for the pain we are all feeling.
Some of you may have observed or heard that Seattle police were in the office yesterday to execute an additional search to make sure there was no other relevant evidence to the case. They did remove some items that may be relevant to the case (mentioned in our Chief Security Officer Kurt John’s message), but no additional recording devices were found. With that done we will be closing the Seattle campus this weekend through Monday to take additional security precautions as our teams continue to work to prevent anything like this from happening in the future. We’re closing campus as we do this work as an additional precaution. The best thing we can do now is help the authorities in every way possible, use resources to heal, and learn from this experience to put additional preventative measures in place.
Let me just end by saying that while we are not the first nor sadly the last company that will likely face something like this, the violation of our collective trust is real and will take time to heal. I know that reading incomplete news stories about our team’s significant efforts to protect employees and identify the individual responsible has been frustrating and disappointing during a disturbing time. While everyone responds to events like this in their own way, I want to reassure you that if you need some time and space, we understand and want you to care for yourselves. If you need some additional time to work remotely you can do so, including during Expedia Week. I urge you to use all the resources we are making available as we continue to ensure you are supported.
I am sorry for any distress this has caused you and can only say that our teams are working tirelessly to make sure you all feel safe and secure on our campuses.
Peter
Post updated to correct the list of brands owned by Expedia Group.
