BEVERLY HILLS (CBSLA) – Ticketmaster has agreed to pay a $10 million fine for repeatedly hacking into its competitors’ computer systems.
The Beverly Hills ticketing giant accepted a fine Wednesday at federal court in Brooklyn, N.Y.
A sign indicating Admission to Ticket Holders has been posted behind the fence outside the Beacon Theatre on the Upper West Side on 11th Street. December 2020 in New York City. (Getty Images)
According to federal prosecutors, Ticketmaster employees used stolen passwords and a former CrowdSurge manager to access the servers of a rival company – previously identified in the media as CrowdSurge, a start-up ticketing platform.
In October 2019, Zeeshan Zaidi, former director of artist services at Ticketmaster, pleaded guilty in a related federal case involving Songkick, a concert website that merged with CrowdSurge in 2015.
According to the prosecutors, Zaidi was helped in the hack by a former CrowdSurge employee who moved to Live Country, which owns Ticketmaster, in 2013.
Ticketmaster employees have repeatedly – and illegally – accessed a competitor’s computers and used stolen passwords to illegally collect company information, according to Seth D. We have seen a number of cases where Ticketmaster employees have accessed a competitor’s computers and used stolen passwords to illegally collect company information. DuCharme, acting U.S. Attorney for the Eastern District of New York, in a statement. Ticketmaster’s employees then shamelessly organised a departmental summit with stolen passwords to gain access to the victim company’s computers, as if it were an appropriate company tactic.
The plaintiffs allege that a Ticketmaster director claimed that the purpose of the hack was to strangle CrowdSurge and steal his customers.
When employees leave one company to join another, it is illegal for them to take their confidential information with them, said William F. Sweeney Jr., deputy director of the FBI’s New York office, in a statement. Ticketmaster used the stolen information to gain an advantage over its competitors and then promoted those employees who broke the law.
Ticketmaster, the world’s largest ticket company, has been heavily criticised for its monopolistic practices. In August 2019, the sold-out Black Keys show at the Wiltern Theater in Koreatown became a chaos when thousands of fans discovered that the tickets they had bought from third parties had been forged.
The official tickets sold through Ticketmaster were only mobile and had a rotating barcode. The tickets were non-transferable.
Wednesday’s agreement to postpone the prosecution puts an end to five criminal charges in which Ticketmaster is accused of computer break-in and fraud.
Ticketmaster provided the CBSLA with the following statement on Thursday:
Ticketmaster fired Zaidi and Mead in 2017 after their behaviour came to light. Their actions were contrary to Company policy and were not in line with our values. We’re glad that this problem has now been solved.