A legislator who has demanded tighter checks on illegal guest houses had a shock when he learned that an unlicensed hostel was operating in a flat he owned. A 1,200 sq ft flat owned and rented out by Paul Tse Wai-chun, the Legislative Council member for the tourism sector, and his wife Pamela Peck Wan-kam, a district councillor, is listed on the popular website Hostel World as a guest house called 'Pandora after 80s'. Tse and Peck insisted they knew nothing about the flat in Causeway Bay being turned into a hostel and produced a contract stating that the flat, rented out for HK$29,800 a month, was strictly for residential use. The lease, agreed last October, runs to September 2014. 'I have so many flats. How do I know what people are doing in there?' an emotional Peck said. 'It's not possible for me to inspect them one by one like dissecting dead bodies. I'm not a detective.' A legal letter would be sent to the tenants ordering them to stop any illegal activities, Tse said. They would be evicted if they refused to comply. In 2009, after a fatal fire at a suspected illegal hostel in Tsim Sha Tsui, Tse called on the government to carry out more inspections, saying unlicensed guest houses were a safety risk and caused nuisance to their neighbours. Young tourists seen leaving the Causeway Bay flat yesterday said they had checked in on the ninth floor and stayed either on the same floor or in another flat on the 11th floor. One, a 25-year-old teacher from the United States, said she had stayed for several nights on the ninth floor, sleeping on a triple-decker bed. 'Chungking Mansions is full,' she said. Another traveller from London was not worried about staying at a hostel that may be illegal, saying accommodation was much worse in India. Room rates range from HK$268 per person for a bed in a mixed dorm shared with 12 other people to HK$980 for a private double bedroom, according to Hostel World. A man who gave his first name as Vincent said he had rented the flat with two business partners in October as a home, but had moved out later after their partnership fell apart. He would not confirm that that was when the flat was converted into a hostel. The Home Affairs Department was reviewing an application for a guest house licence for the 11th floor flat, a spokesman said, but it had not granted any licence for the flat on the ninth floor. Officers had patrolled the premises, and would prosecute if there was evidence of an illegal guest house, he said. The department received 696 complaints about suspected unlicensed guest house operations and instituted 53 prosecutions last year. There were 39 convictions. The executive director of the Travel Industry Council, Joseph Tung Yao-chung, urged the government to speed up its processing of guest house licence applications. 'The incident shows there is a demand [for hostels]. Even beds are hotly sought after,' he said. Anyone running illegal lodgings who fails to get a licence after a grace period should be prosecuted, Tung added. He also urged the government to consider legalising home-stays - where tourists pay to stay with people in their homes. Tang said the government should think about how it can diversify the supply of accommodation as hotel occupancy rates increase.