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AG's Office: New York Has 'Rigged' Ticketing System For Concerts, Sporting Events

ALBANY, N.Y. (CBSNewYork/AP) -- New York's attorney general says investigators found practices and abuses in sales of concert and sports tickets that prevent consumers from buying tickets at affordable prices or sometimes even getting them at all.

Attorney General Eric Schneiderman said in a report released Thursday that his investigation of the industry was prompted by consumer complaints, which his office receives regularly.

"Ticketing, to put it bluntly, is a fixed game,'' the report said. Investigators found abuses and practices that prevent consumers from buying tickets at affordable prices or sometimes even getting them at all.

Investigators found that third-party brokers resell tickets on sites like StubHub and TicketsNow at average margins of 49 percent above face-value and sometimes more than 10 times the price. Some brokers use illegal specialty software, called "ticket bots,'' to quickly purchase as many desirable tickets as possible for resale at significant markups, they said.

The report cited a single broker buying 1,012 tickets within one minute to a U-2 concert at Madison Square Garden when they went on sale on Dec. 8, 2014, despite the vendor's claim of a four-ticket limit. By day's end, that broker and one other had 15,000 tickets to U2's North American shows.

"It uncovers what's really a shadowy network, or has been up until now, of middlemen, brokers, ticket vendors and more who really use any means they can, some legal, some illegal, to jack up the prices of tickets and squeeze money out of fans," Schneiderman told reporters.

Schneiderman says his office has also reached settlements with two ticket brokers operating without a reseller license.

The settlements with MSMSS LLC and Extra Base Tickets LLC require them to pay $80,000 and $65,000, respectively. The companies and their principals must also maintain a license.

The attorney general's investigation prompted by consumer complaints found that 54 percent of tickets are reserved for various industry insiders such as the venues, artists and promoters or reserved for "pre-sale'' events or private groups.

"Less than half the tickets are made available to the public. Most of those that are made available are sucked up by brokers. Consumers are left to pay exuberant fees or astronomically high prices on the resale market and that's what we call a rigged system," Schneiderman said.

The attorney general brought up a particularly alarming scenario where a bot bought a One Direction ticket for $101 and resold it at 70 times the price.

The report also notes many NFL teams encourage or even require ticket holders to use Ticketmaster's NFL Ticket Exchange platform, where the seller is prohibited from cutting the price below face value. That prevents lower prices when demand drops.

Investigators say Ticketmaster and other sellers regularly tacked on fees that added more than 21 percent to the face value.

(TM and © Copyright 2016 CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2016 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)


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