FTC says 379,776 concert tickets purchased illegally for resale
The Federal Trade Commission is suing Key Investment Group (KIG) alleging 379,776 concert tickets purchased illegally for resale for Taylor Swift’s Eras Tour, Bruce Springsteen and other concerts using methods that violate the BOTS Act.
Those tickets cost nearly $57 million, according to the FTC. The Defendants resold a portion of those tickets on secondary marketplaces for approximately $64 million. in many cases, charging a significant markup, according to the complaint. Resale markups for the Era’s tour commonly reached 200% – 1000%.
For the Taylor Swift Eras Tour, the defendants allegedly purchased 2,280 tickets for 38 shows, paying $744,970 and reselling them for $1,961,980 – a $1,217,010 profit. For one Swift concert, the defendants allegedly exceeded the Eras Tour’s 2023 six-ticket per show limit, using 49 accounts to purchase 273 tickets.
For one Bruce Springsteen concert in Sept. 2023, KIG allegedly used 277 different accounts to buy 1,530 tickets and collect $20,900.84 in revenue.
The concert tickets purchased illegally by KIG allegedly violated the FTC Act and the Better Online Ticket Sales (BOTS) Act. The latter law makes it illegal to “circumvent a security measure, access control system, or other technological control or measure on an Internet website or online service that is used by the ticket issuer to enforce posted event ticket limits…”
KIG allegedly bypassed Ticketmaster security measures designed to block resellers from violating ticket purchasing limits by:
- using thousands of Ticketmaster accounts to purchase tickets, including fictitious and third-party accounts that the defendants purchased
- utilizing thousands of virtual and traditional credit card numbers
- hiding their identity by using proxy or spoofed IP addresses
- using SIM boxes to facilitate the receipt of verification codes sent to the phone numbers associated with the thousands of fake and third-party accounts they used to purchase tickets.
“President Trump made it clear in his March Executive Order that unscrupulous middlemen who harm fans and jack up prices through anticompetitive methods will hear from us,” said FTC Chairman Andrew N. Ferguson. “Today’s action puts brokers on notice that the Trump-Vance FTC will police operations that unlawfully circumvent ticket sellers’ purchase limits, ensuring that consumers have an opportunity to buy tickets at fair prices.”
The Commission vote authorizing the staff to file the complaint was 3-0. The FTC filed the complaint in the U.S. District Court for the District of Maryland, Northern Division on August 18.
READ FULL FTC VS. KEY INVESTMENT GROUP COURT FILING
Key Financial Filed Preemptive Lawsuit
Maryland-based ticket broker Key Investment Group (KIG) also operates as Epic Seats, TotalTickets.com, and Totally Tix. KIG CEO, Yair D. Rozmaryn, Chief Financial Officer, Elan N. Rozmaryn, and Chief Strategic Officer, Taylor Kurth, were also named in the FTC complaint.
In late July, Key Financial Group filed a preemptive suit claiming: “The FTC believes the ticket limits set forth by the primary ticket issuer apply on a company level and not individual. The FTC’s novel interpretation of the BOTS Act would make many consumers and most companies – including nearly every Fortune 500 company – in violation of the law.”
“KIG’s model involves using hundreds of Ticketmaster accounts, pseudonyms, and remote browsing tools to scoop up tickets and flip them on resale platforms,” said fair-ticket advocate Randy Nichols after KIG filed its suit. “They claim it’s legal because they didn’t use “bots.” But let’s be honest: it’s functionally no different.”
READ FULL FTC VS. KEY INVESTMENT GROUP COURT FILING
Bruce Houghton is Founder & Editor of Hypebot, Senior Advisor at Bandsintown, a Berklee College Of Music professor and founder of Skyline Artists.
