
Ticketmaster will pay $10 million for accessing Songkick’s online pre-sales systems without authorization.
Live Nation
Ticketmaster is paying a $10 million criminal fine for repeatedly accessing the computer systems of one of its competitors without authorization. The online ticketing company agreed to the fine Wednesday after being charged with five counts of computer intrusion and fraud by the United States Attorney’s Office for the Eastern District of New York.
Ticketmaster employees used stolen passwords to access Songkick’s systems to “unlawfully collect business intelligence,” said Seth DuCharme, acting United States attorney for the Eastern District of New York. The tactic was also promoted at a Ticketmaster summit for employees, the Justice Department said.
Read more: Stimulus payments will begin to arrive ‘tonight’: When the IRS will send your second check
The stolen passwords were obtained by an ex-employee of Songkick, according to the investigation, back in 2014. The passwords were used to gain access to the company’s “Artist Toolbox,” which contained real-time information about pre-sale tickets being sold for specific artists.
The ex-employee also provided Ticketmaster with Songkick’s internal and confidential financial documents, after which he was promoted and given a pay rise, the Justice Department found.
“Ticketmaster used stolen information to gain an advantage over its competition, and then promoted the employees who broke the law,” said William Sweeney, Jr., assistant director-in-charge of the FBI’s New York Field Office.
By knowing the sequential system Songkick used to number its URLs for these hidden web pages, the ex-employee also enabled Ticketmaster to maintain a spreadsheet with every artist Songkick was working with on pre-sales. Ticketmaster could then contact those artists and persuade them to sell tickets through Ticketmaster instead of the Songkick, the Department of Justice said.
As well as the $10 million fine, Ticketmaster must also institute a compliance and ethics program.
As part of the scheme, Zeeshan Zaidi, the former head of Ticketmaster’s Artist Services division, pleaded guilty to conspiring to commit computer intrusions and wire fraud back in October 2019.
“Ticketmaster terminated both Zaidi and Mead [the Songkick ex-employee] in 2017, after their conduct came to light,” a Ticketmaster spokesperson told CNET. “Their actions violated our corporate policies and were inconsistent with our values. We are pleased that this matter is now resolved.”
Sources with knowledge told CNET that no one above Zaidi — who was Mead’s boss — knew about the practice.
The case was the subject of a civil settlement in January 2018, which saw Ticketmaster’s parent company Live Nation acquire Songkick’s ticketing commerce platform, anti-scalping algorithm, APIs and patents.