FTC Sues Ticket Reseller Over Taylor Swift Eras Tour Scalping: ‘Unscrupulous Middlemen’

Federal regulators say a company illegally bought thousands of tickets to Taylor Swift’s Eras Tour and resold them at inflated prices for more than $1 million in profit, according to a new lawsuit.

In a complaint filed Monday (Aug. 18) by the Federal Trade Commission (FTC), the watchdog group accused ticket broker Key Investment Group LLC of using “illegal means” to purchase more than 379,000 event tickets on Ticketmaster, including 2,280 for Swift’s record-shattering Eras concerts.

By “charging a significant markup to consumers” when reselling those tickets, attorneys for the FTC say Key Investment Group made roughly $7 million in profit — and deprived concertgoers of the chance to buy them at a fair price.

In a statement announcing the case, FTC Chairman Andrew N. Ferguson said the agency was sending a message to “unscrupulous middlemen who harm fans and jack up prices through anticompetitive methods.”

“Today’s action puts brokers on notice that the Trump-Vance FTC will police operations that unlawfully circumvent ticket sellers’ purchase limits, ensuring that consumers have an opportunity to buy tickets at fair prices,” Ferguson said.

In a statement, Key Investment Group said it would “vigorously defend itself” against a “clear example of regulatory overreach.”

“The case threatens to dismantle the secondary ticket market for live events, further consolidating power in the hands of the industry’s largest monopoly,” the group said.

Ticketmaster and parent company Live Nation were not named in the lawsuit nor accused of any wrongdoing.

Swift’s Eras Tour wrapped in December with a record-shattering haul of more than $2 billion in face-value ticket sales over a two-year run. The unprecedented demand for the tickets led to a disastrous presale in November 2022 and then created an infamously pricey resale market throughout the run.

In Monday’s lawsuit, the FTC says Key Investment bought at least 10 tickets to 38 different Eras Tour concerts, paying a total of $744,970.29. It then resold them on the secondary market for $1,961,980.65, netting $1,217,010.36 in profit.

At just one concert — Taylor’s stop at Las Vegas’ Allegiant Stadium in March 2023 — Key Investment allegedly used 49 different accounts to buy 273 tickets, a move the FTC says “dramatically exceeded” the six-ticket limit imposed by Ticketmaster.

To get around such limits, FTC says the group used “thousands of fictitious Ticketmaster accounts,” as well as proxy or spoofed IP addresses, virtual credit cards and fictitious names.

Notably, the lawsuit claims the group also used so-called SIM banks — a device holding hundreds of cellphone SIM cards commonly used by scammers to send text messages from different phone numbers. The group allegedly used the banks to receive the unique verification codes sent by Ticketmaster to thwart the use of ticket-buying bots.

Monday’s case was filed under the Better Online Ticket Sales Act, or BOTS Act, a 2016 statute that makes it illegal to use technology like bots to buy tickets en masse by skirting platform restrictions.

“By circumventing Ticketmaster’s security measures, access control systems, or other technological controls or measures to buy tickets, and then selling or offering to sell the tickets, Defendants have violated and continue to violate the [BOTS] Act,” the lawsuit says.

But in its response statement, Key Investment Group said the lawsuit “twisted the intent” of the BOTS Act and turned it into “a weapon against legitimate businesses and consumers.”

“Under the FTC’s interpretation, anyone who purchases more than four tickets or uses more than one account could be deemed in violation of federal law,” the group said. “That outcome is not only illogical, it is absurd.”

It’s not the first time that Swift’s infamously pricey tickets led to a crackdown. Earlier this year, New York prosecutors brought criminal charges against a “cybercrime crew” that allegedly stole more than 900 tickets to the Eras Tour and other events and then resold them for more $635,000 in illegal profit.