FTC Sues Ticket Broker Over Unlawful Tactics Used to Buy Millions of Tickets to Popular Live Events

The Federal Trade Commission sued REPS & Company Inc., alleging the ticket broker illegally circumvents measures designed to limit the number of tickets that can be purchased for a single event, purchasing millions of tickets to high-demand events that it later resells at a significant profit.

The complaint, filed by the Department of Justice upon notification and referral from the FTC, alleges REPS, along with its CEO Ryan Pancheri, President Brian Archibald and Chief Operating Officer Nicholas Totagrande, violated the Better Online Ticket Sales Act. The law makes it illegal to "circumvent a security measure, access control system or other technological control or measure on an Internet website or online service that is used by the ticket issuer to enforce posted event ticket limits or to maintain the integrity of posted online ticket purchasing order rules."

The complaint alleges that, since 2022, REPS and its operators used a variety of unlawful tactics to bypass security measures from ticket issuers in order to exceed ticket limits set by ticket issuers. REPS purchased more than eight tickets for at least 83,500 events-many of which were high demand and likely to sell out. REPS spent more than $1.3 billion to amass more than 18.5 million tickets for these events, generating at least $120.8 million in profit by reselling these tickets on the secondary marketplace. For example, REPS generated $833,000 in profit by using 1,300 accounts to purchase 7,624 tickets to just one Beyonce Renaissance tour concert in Kansas City, Mo., in 2023, according to the complaint.

"REPS' entire business model is focused on trying to game the ticket-purchasing system in order to obtain as many tickets as possible to resell at inflated prices to consumers," said Christopher Mufarrige, Director of the FTC's Bureau of Consumer Protection. "Companies that seek to profit by driving up prices or depriving ordinary fans of access to reasonably priced tickets to their favorite shows or events should be on notice that we are watching and will take action to stop this unlawful conduct."

Ticket issuers such as Ticketmaster and AXS have put in place measures to block resellers from violating ticket-purchasing limits to popular events. These security measures include ticket quantity selectors capped at the ticket-purchasing limit and monitoring whether purchases are associated with verifiable accounts and unique credit cards, email addresses, phone numbers and IP addresses, according to the complaint.

The complaint alleges that REPS uses a team of employees, most of whom are based in the Philippines, who use unlawful methods to bypass Ticketmaster and other ticket-issuer account security measures. These unlawful methods include using thousands of ticket-purchasing accounts created with names, addresses or phone numbers belonging to someone other than the ticket purchaser and virtual credit card accounts and phone numbers controlled by REPS. In addition, they also used IP proxy services and multi-session browsers that mask the identity and location of the account user, the complaint alleges.

For example, REPS has agreements with its employees and third-party partners authorizing the company to use their names and addresses to establish accounts with ticket issuers to create multiple accounts that are used to help purchase tickets, according to the complaint.

When ticket issuers detect attempts to bypass ticket limits, the issuers often block or cancel the ticket purchase. In response, REPS has developed strategies to help its employees work around these ticket limit controls, such as making slight changes to an account holder's address or name, the complaint alleges. In fact, internal company documents show that REPS officials discussed tactics to ensure their accounts won't be blocked by ticket issuers.

The Commission vote to refer the complaint to the DOJ for filing was 2-0. The Department of Justice filed the complaint on behalf of the Commission in the U.S. District Courtfor the Southern District of California.

NOTE: The Commission refers a complaint for civil penalties to the DOJ for filing when it has "reason to believe" that the named defendants are violating or are about to violate the law and that a proceeding is in the public interest. The case will be decided by the court.