Ticketmaster Fined $10m
Ticketmaster operates a platform for consumers to buy tickets for events including music concerts and sporting events.
A group of Ticketmaster executives created a hacking attack against a rival concert pre-sales firm, with the aim to take down its business and now Ticketmaster has agreed to pay a criminal fine of $10 million (£7.3m) after staff admitted to hacking into a rival firm's systems in order to "choke off" their presale ticket business. US prosecutors say the goal was to “steal back” key clients.
Under the terms of the settlement, Ticketmaster will pay a criminal penalty of $10 million and will maintain a “compliance and ethics program designed to prevent and detect violations” of computer-hacking laws as well as to prevent the “unauthorised and unlawful acquisition of confidential information belonging to competitors.”
The US Department of Justice (DoJ) said employees of Ticketmaster, a subsidiary of Live Nation Entertainment, "repeatedly" infiltrated the computers of a rival presale tickets seller. According to the US Eastern District Court of New York, a former employee of the victim firm, Crowdsurge which maintained a presence in both the UK and New York until 2017, left their post in 2012 to join Live Nation.
Despite signing a confidentiality agreement before entering their new employment, this individual, instead, entered into a scheme designed to disrupt the competitor's business operations.
The DoJ says that after joining Live Nation in 2013, the co-conspirator shared confidential information with Ticketmaster employees including the former head of the Artist Services division Ahmed Zeeshan Zaidi. Ticketmaster's rival offered presale tickets before they were made available to the general public and created a password-protected app for artists to track their ticket sales, known as Toolboxes. The unnamed conspirator was promoted and given a raise the year following. Ticketmaster employees continued to lurk in Toolboxes and maintained a spreadsheet of all account URLs until the end of 2015.
One of the overall goals was to "steal back one of the victim company's signature clients," US prosecutors said, and if successful, this would "choke off" the Ticketmaster rival, "cutting them off at the knees."
A senior executive of Live Nation asked Zaidi and others to prepare a presentation comparing Ticketmaster pre-sale to the rival's Toolboxes, and the team obliged, by once again using the stolen passwords, this time in public. Employees involved in the scheme were fired. US prosecutors filed five criminal counts against Ticketmaster, including wire fraud and conspiring to commit computer intrusion. In a separate but related case, Zaidi pled guilty to conspiring to commit computer intrusions and wire fraud.
Ticketmaster will pay a criminal penalty of $10 million and has agreed to submit to a three-year deferred prosecution agreement including the creation of a new compliance and ethics program. The ticket seller must also report to the United States Attorney's Office annually until the agreement expires.
US Dept. of Justice: Variety: Threatpost: ITPro: ZDNet:
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