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Paradise Papers Expose Canadian Scalper's Multimillion-Dollar StubHub Scheme (www.cbc.ca)
An anonymous reader quotes a report from CBC.ca: When Adele fans went online to buy tickets to the pop superstar's world tour last year, they had no idea what exactly they were up against. An army of tech-savvy resellers that included a little-known Canadian superscalper named Julien Lavallee managed to vacuum up thousands of tickets in a matter of minutes in one of the quickest tour sellouts in history. The many fans who were shut out would have to pay scalpers like Lavallee a steep premium if they still wanted to see their favorite singer. An investigation by CBC/Radio-Canada and the Toronto Star, based in part on documents found in the Paradise Papers, rips the lid off Lavallee's multimillion-dollar operation based out of Quebec and reveals how ticket website StubHub not only enables but rewards industrial-scale scalpers who gouge fans around the world.
Lavallee's name appears over and over in the records, alongside the names of his wife, his father and other friends and family. The records show them somehow buying tickets from different locations around the world at the same time, placing orders from cities like Chicago, Los Angeles, London and Montreal. Lavallee, who got his start in his early 20s reselling hockey and concert tickets while living at home with his parents, now runs an international ticket harvesting operation. Financial records detail $7.9 million in gross sales in 2014 alone. [T]he CBC/Star investigation also discovered a password-protected portal exclusively for StubHub's top sellers who prove they can move more than $50,000 worth of tickets a year. The company offers them special software to upload and manage huge inventories of tickets. StubHub said in a statement: "StubHub agrees that the use of bots to procure tickets is unfair and anti-consumer. StubHub has always supported anti-bots legislation and encourages policy-makers to look comprehensively at the host of factors that impact a fan's ability to fairly access, buy, resell, or even give away tickets in a competitive ticket market."
Lavallee's name appears over and over in the records, alongside the names of his wife, his father and other friends and family. The records show them somehow buying tickets from different locations around the world at the same time, placing orders from cities like Chicago, Los Angeles, London and Montreal. Lavallee, who got his start in his early 20s reselling hockey and concert tickets while living at home with his parents, now runs an international ticket harvesting operation. Financial records detail $7.9 million in gross sales in 2014 alone. [T]he CBC/Star investigation also discovered a password-protected portal exclusively for StubHub's top sellers who prove they can move more than $50,000 worth of tickets a year. The company offers them special software to upload and manage huge inventories of tickets. StubHub said in a statement: "StubHub agrees that the use of bots to procure tickets is unfair and anti-consumer. StubHub has always supported anti-bots legislation and encourages policy-makers to look comprehensively at the host of factors that impact a fan's ability to fairly access, buy, resell, or even give away tickets in a competitive ticket market."
So like a million dollars max profit a year, on an enterprise run out of multiple cities?
Something isn't adding up here.
events should have a ticket lottery system so that it's more fair and for some say one a year events (more so across many time zones) and it can stop the untenanted multi buys say I want to go this event but I don't know If I can be online at the time / day it's due to open so you ask some to try to get them for you but you end getting in at the right time.
Also fixes the buy rush endless reloading game.
It would be so easy to shut out scalpers by selling tickets through dutch auctions. If you grab them all early, you pay a big markup.
ID: the nose did not occur naturally, how would we wear glasses otherwise? (apologies to Voltaire)
You should only be allowed to sell 5 or the max per login/account/credit card/etc. They are complicit and openly racketeering.
This wouldn't even be an issue if the concert promoters sold tickets at actual market value.
TicketMaster, StubHub and other could stop the scalpers from grabbing all the tickets if they wanted to. But they're making their money so they don't give a shit who gets the tickets, scalpers or the actual fans.
Easiest way to do it, max limit of 10 tickets per person / credit card per event date.
It's good to see at least one business in Quebec made a profit. And almost nobody here watches the CBC. It's just too damn boring. Even for us.
The real story here is Trudos corruption. As a Canadian to me it is outrage and he should be locked up.
Right of first sale here. If the market doesn't want scalpers, people wouldn't buy from them. There is nothing wrong with scalping. It is buying a resource and reselling to people who are willing to pay more for it, the basics of capitalism, which is the best system of government and commerce ever invented by mankind.
Require the ticket user's name be printed on the ticket, and confirm your ID matches before you're allowed in.
That the ticket sales sites don't implement such a simple solution suggests they actually like scalpers. The scalpers help guarantee an event sells out even if not all the seats are filled. i.e. The risk of a non-sellout is shifted from the ticket sales site to the scalpers, with the scalpers losing money if the event doesn't sell out, but pocketing the cash if the event does sell out. The ticket sales sites benefit from less variability in ticket sales, and thus more predictability in their income.
Simple solution: make tickets sold on-line non-transferable and marked with the name of the person they're for. When you buy tickets through a retail channel they have to collect a name for each ticket, which shouldn't be a problem for someone buying for a group of friends. At the door the ticket gets checked against identification and if the name doesn't match the ticket's no good.
If the primary outlet wants to allow resellers to buy for other people, they'd have to implement a reservation system where they can reserve (but not purchase yet) the number of tickets they expect to sell that day. They collect the credit-card information and names from the buyer, submit an order to the vendor against their reservation and send the tickets to the buyer when the purchase is confirmed. The reseller's profit would be the difference between the retail price of the tickets and what the reseller was charging buyers for them. Their daily reservation would be limited and the limit adjusted based on the average number of orders they submitted a day, with the reservation expiring at the end of the day. The primary vendor could also impose limits such as no more than 50% of the event's tickets being available to resellers.
Doesn't directly regulate the pricing, but now no one reseller can "lock up" the entire inventory for an event and control the price that way. If a reseller prices tickets too high, buyers will go somewhere else. And if someone gets the bright idea of setting up a network of reseller entities, they run into the problem of keeping the sales for each entity high enough to earn a big enough reservation block while simultaneously spreading the sales out enough to keep from having reservation blocks reduced for lack of sales on some entities.
The Panama & Paradise papers contain a LOT of dirt on politicians, celebrities, governments and multinational corporations.
So of course the headline news is about this low level stranger you've never heard of. This guy's bad. You should be mad at him.
The fact that there is enough room to support the scalping business between the ticket price and what people are willing to pay is an indication that ticket prices are too low for the given demand.
I remember reading about a band more than decade ago who was concerned about this so they limited ticket sales to in-person sales with limit of how many each person can purchase. Now it still didn't stop the scalpers from paying someone from standing on the line to buy the tickets for them but many real fans got to purchase the tickets at a list price.
"In addition to the Queen, three former Canadian prime ministers have connections to the offshore world that show up in the Paradise Papers."
I've no idea why shows sell tickets below the market price. Money aside, it is PITA for a top paying customer when I have to go to a reseller rather than buy the ticket directly.
Smart show company: Cirque de Soleil in Canada. In my limited experience tickets are always available for tomorow's show, in all or most price zones, at a price of course. I've just checked tomorrow's show in Toronto, and there are seats. I am happy customer.
Stupid company (okay, stupid in this particular aspect): Studio Ghibli museum in Tokyo. Just what tourist would think he needs to plan a visit to the museum a month in advance? Of course I've arrived in Japan and THEN started checking the museum's opening times. Oops. It has limited admission and is sold out beyond the date of my departure. I had to send a dozen emails, make a call, wait a day, then physically schlepp to a reseller in a different part of Tokyo to get the piece of paper (at 7x the price). Boy was that inconvenient. Why doesn't the museum reserve a few tickets a day and sell those at 10-20x the price right there at the entrance?
17779 eligible voters in a district, 17779 'vote' as one. This is Russia.
Problem solved.
Most of the posts above believe the artist gets to set the price of tickets.
The artist gets paid their minimum amount when the contract is signed with the promoter. They may have a clause to get a % of the door, they may not. In many cases there is a deposit and a payment delivered to the artists before they go on stage.
This is independent of the promoter who is on the hook for the act in question. They are responsible for paying the artist, the location of the event, and all costs associated.
Scalpers make their living off of the difference between the promoter and the buying public - not directly to the artist.
The industry is full of "promoters" who have lost their shirts on sold out shows....
Adele produces screaming pop songs designed to keep homeless riggers from sleeping in McDonalds and other restaurants, which play these pest-control songs at high volume in a scheme concocted and marketed by Ryan Seacrest.
Which accomplishes NOTHING, since we're talking international borders.
And, meanwhile, they put into place apparatus to assist abusers in their endeavors.
Chas - The one, the only.
THANK GOD!!!
The companies selling tickets put no real controls in their system to stop the mass purchase & reselling of tickets. Companies without rules are enablers. After all, they just want to sell their stock and make their profit, so there's little incentive for them to change unless there are huge amounts of empty (but paid for) seats at events. These companies are the source of the problem, and it's up for them to fix it. The scalpers want to make a new market off of art appreciation, and thus resells items for ridiculous markups. Exploiting other people for more cash than something is worth = Shitty job for shitty humans who live in unsustainable bubbles. HOW ABOUT THIS FIX: Ticket companies sell 1 ticket per transaction. Purchased tickets are attached to a person's name, email, phone number, etc. People can only pick up these tickets at the event itself after verifying with their personal information / ID card. More options, like ticket transfers or extra rules, could and should be implemented to enable consumer choice & counteract successful scalpers who try to find exploits in this system.
Then there's no scalping. Pre-order reservtions if done at all would have to be picked up on the day in person. Good luck scalping when you have to turn up with 1000 "best friends" you bought those tickets for and have to hand out for free to.
Ticketmaster should fuck off too. They're just "official" scalpers. Why the fuck am I paying a surcharge for their "service" when there's only their service to use? And why will they ONLY mail it and charge me over the odds for mail?
And if I had bought a ticket in error I would sell it at cover price. After all, if I don't sell it, I'm down the price of the ticket, so why would I need a profit?
I agree with this sentiment.
>Then there's the problem of what qualifies as an ID, especially with international events.
There is no such thing. Just fucking specify what is valid, and follow those rules. Just don't go full retard and think passports are supposed to be used for civilian identification.
You don't even need to do it properly, anything with name on is fine so long it looks like its real plastic. If it gets to the point where scammers has to run a card printing operation, with mismatched genders and name heritage, well thats at the least a cost they have to bear.
These scumbags got hold of a bunch of tickets to a charity concert and sold them at a huge markup. None of that money went to charity, of course.
I've calculated my velocity with such exquisite precision that I have no idea where I am.
If I see a concert is sold out, I don't go. I also don't stand in line for movies or restaurants, because there are plenty of other options. And often, those options are still satisfying, cost less, and aren't as crowded or noisy. Movies eventually come out on DVD anyway. It's the same movie six months from now as it is in the theater. I'll admit the sound is better in the theater or concert, but I can still enjoy it. I don't have the hedonistic desire to have the 'best' experience, just to enjoy life to it's fullest. And that includes not standing in line or paying too much.
If more people stopped giving in to their 'gotta have it' hedonistic personality, the scalping market would dry up. It must be nice to have so much disposable income that one can spend hundreds of dollars on a concert, or take days off of work and ignore all obligations to wait in line to be first.
I rarely read replies, it's my opinion and if you thought about your opinion a little more, I'm OK with that.
Just look at the ridiculousness of the StubHub official statement:
"StubHub agrees that the use of bots to procure tickets is unfair and anti-consumer." Nowhere do they say they don't allow bots. They just say they're unfair. But maybe, y'know, turn a blind eye to them. They will not even say they take any effort to stop bots, because they don't -- as long as the tickets are sold, they don't care how much the fans get screwed.
"StubHub has always supported anti-bots legislation and encourages policy-makers to look comprehensively at the host of factors that impact a fan's ability to fairly access, buy, resell, or even give away tickets in a competitive ticket market." We say we support legislation, but it's policy-makers who need to do something... until then, we will fleece buyers for every penny. Their official statement is so full of holes as to be beyond contempt.
This is why I just don't go to concerts. I would like to from time to time, but it just seems like each and every person in a seat is getting ripped off. I won't subject myself and my family to that. I hope that someone things of a fair and equitable way some day.
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
Don't sell tickets to folks in jurisdictions where scalping is legal.
Require id matching the buyer to use the ticket. If fan can't make it, he can only resell thru the official site the ticket was originally sold thru, with the site picking who rebuys the ticket.
The solution to this is to simply sell tickets at outragrous prices (10-20x face value), then offer rebates on used tickets.
Example: you pay $1000 for your ticket to the concert but then you get $950 back if you go, so it really only cost you $50. If you don't go, you're out $1000, so there's incentive to use your ticket or sell to somebody who will.
What this will do is severely penalize unsold inventory, making it unprofitable to speculate. They can reduce the markup as it gets closer to the event, giving scalpers an incentive to wait, allowing legitimate fans an opportunity to buy for themselves.
dom
Scalpers can sell their tickets at a profit. Clearly they're charging what the market can bear. If venues raised their prices to near what the market can bear and sold tickets online directly using an easy-to-use system, the profit motive for scalping would go away. Real question is, why aren't venues selling directly at more of a profit?
the folks running major corporations that already get most of the H1-Bs all mostly sit on each other's board of directors. Plus I'm sure they'd take that opportunity to raise the number of visas. Put enough of 'em out there and the auctions won't go that high.
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it doesn't work that way. Multiple bands have complained that nobody shows up at their shows because the tickets have been scalped like crazy. If I can sell 1000 tickets for $10 or 10 tickets for $2000 I'm going with option b. The reason event promoters can't do that is bands don't get a cut of ticket sales unless they're so huge they can fill arenas. Bands make their money selling merchandise, so if nobody shows up to the show they lose money on the tour even while the scalpers are making bank.
Plus the venue owners don't mind the scalpers one bit. All they care about is selling the tickets in the first place. The system lets the venue owners put the risk of actually putting people in seats in the hands of the scalper and the band, and super-fan "whales" (it's a free to play term that seems to fit here) mean the scalpers aren't taking much risk. They just need 10 guys with more money than they know what to do with to make an extra $10k like I mentioned above. The ones that get screwed are the bands when there's nobody to sell t-shirts & CDs to and when they die on the vine because folks lose interest because they can't afford to see them live.
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Stick QR codes on them, that will stop it!
In a Dutch Auction, the price starts high and lowers a time goes on.
If all tickets were priced the same and the initial price was about 10 time the price of the
current premium tickets. The price of the tickets is lowered linearly to about 1/2 the price
of the current lowest price for a ticket. The rush to buy tickets would no longer exist.
People could wait until they had a prices they were willing to pay, either that or not go to the event.
The scheme does not interfere with legitimate re-sellers.
Is that StubHub's whole statement? I ask because it's very telling. Sure, they say that bots are "unfair and anti-consumer" but that its the government's responsibility to come up with a solution, not theirs. I mean, we know SubHub doesn't care about consumers but it's almost refreshing to see them admit it.
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