Pair jailed for secondary ticketing fraud worth £3.5million

25 February 2020

Two ‘ticket touts’ from London have been sentenced to a total of six-and-a-half years behind bars following a ground-breaking hearing at Leeds Crown Court yesterday (24 February 2020). The sentences follow the first successful prosecution against a company fraudulently reselling tickets on a large scale.

Peter Hunter, aged 51, was sentenced to four years in prison and David Thomas Smith, aged 66, to 30 months behind bars. It follows an investigation by the National Trading Standards eCrime Team, which is hosted by North Yorkshire County Council and City of York Council.

Earlier this month (13 February 2020) jurors at Leeds Crown Court found Mr Hunter and Mr Smith guilty of fraudulently and dishonestly buying and reselling tickets for high-profile music and entertainment events. The pair ran BZZ Limited, a multi-million pound limited company through which they purchased and resold hundreds of tickets at inflated prices for events and concerts such as Ed Sheeran, Harry Potter and the Cursed Child (the play), Madness, McBusted and many other mainstream acts.

The judge found that Mr Hunter and Mr Smith committed their offences between May 2010 and December 2017. The court heard yesterday that the pair made a net profit of £3.5 million in the last two years of the fraud. There were thousands of people who were denied the opportunity to purchase tickets at face value, as well as those who were sold invalid and overpriced tickets. Despite multiple warnings to desist and measures imposed to prevent fraudulent purchases, the offences were only brought to an end following the intervention by National Trading Standards.

The full sentences are as follows:

  • Count 1: Fraudulent trading – namely by knowingly enabling BZZ Limited to purchase event tickets for resale and/or fraudulently reducing the number of event tickets available for consumers to purchase at face value (Mr Hunter sentenced to four years, Mr Smith to 30 months)
  • Count 2: Possession or control of an article for use in fraud – including the use of bots and debit/credit card payments held in the names of people other than BZZ Limited (Mr Hunter sentenced to 12 months, Mr Smith to 12 months – to be served concurrently with Count 1)
  • Count 3: Fraudulent trading – based on continuing the business of BZZ Limited for a fraudulent purpose between 19 May 2010 and 13 December 2017, namely by offering for resale tickets which were at risk of being refused entry and/or falsely representing that said event tickets offered for resale were valid (Mr Hunter sentenced to two years and Mr Smith sentenced to two years – to be served concurrently)
  • Count 4: Fraudulent trading – by listing and offering event tickets on secondary ticket websites that they did not own, and/or falsely representing that BZZ Limited did own the said event tickets (Mr Hunter sentenced to 18 months, Mr Smith to 18 months – to be served concurrently)

The investigation by National Trading Standards found that the defendants used several dishonest and fraudulent tactics to purchase multiple tickets from primary ticket sellers such as Ticketmaster, Eventim and AXS. This meant that BZZ Limited was dishonestly and fraudulently competing with consumers to purchase tickets from the websites of primary sellers while, at the same time, listing those tickets for sale to consumers at inflated prices.

Furthermore, the company’s tactics circumvented the platforms’ terms and conditions and their automated systems to block multiple purchases. This saw them purchase more than 750 Ed Sheeran tickets in 2017. Despite knowing that their purchases had contravened the primary sellers’ terms and conditions – making tickets liable to be cancelled – the defendants knowingly continued to resell hundreds of tickets to consumers at inflated prices.

To evade the platforms’ systems, the defendants:

  • Acquired, created and maintained a network of identities that were used to commit the fraud.
  • Used a number of different people to buy tickets, causing a significant number of other persons to become involved in the fraudulent behaviour, thus rendering those persons liable to arrest and prosecution for those offences or fraud or aiding and abetting fraud.
  • Used checklists such as the AXS list to avoid using the same identity too many times.
  • Acquired specialist software including bots; Insomniac Browser; Omni Checker and Roboform to facilitate the greater efficiency of fraudulent behaviour.
  • Studied the systems of Primary Sellers to overcome measures intended to prevent the fraudulent behaviour (for example: taking steps to circumvent captchas or the detection of IP addresses).
  • Further lied to maintain the false impression created by the use of multiple names and identities to purchase tickets (for example: pretending to be individual cardholders / consumers when contacting primary sellers).

The pair also engaged in fraudulent trading by listing tickets for sale on secondary ticketing websites that they had not purchased and did not own. Known as ‘spec selling’, the idea was to induce consumers to agree to ‘buy’ non-existent tickets at an inflated price. Once sales had been secured, the defendants would try to source the tickets to fulfil the purchase. Consumers were therefore tricked into paying an inflated price and also exposed to the risk that BZZ Limited would be unable or unwilling to supply the ticket.

Through their activities, Mr Hunter and Mr Smith involved a number of other people in their fraud, making them liable to arrest and prosecution. This includes those who allowed their credit and debit cards, names, addresses and other details to be used to misrepresent the identity and nature of the purchaser.

Lord Toby Harris, Chair of National Trading Standards, said:

This is an important milestone in the fight to tackle online ticket touts who fraudulently buy and resell tickets to thousands of victims to line their own pockets. Today’s sentences send a strong message to similar online ticket touts: these are criminal offences that can lead to prison sentences. I hope this leads to a step-change in the secondary ticketing market, making it easier and safer for consumers buying tickets in the future.

I would like to congratulate our teams who have worked tirelessly on this investigation and would urge anyone who suspects that a sale may be fraudulent to report it to the Citizens Advice Consumer Service by calling 0808 223 1133.

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