When the Metropolitan Police in London demand legislation to combat ticket crime, it is time to take notice.  Operation Podium, set-up to combat ticket fraud for the London 2012 Olympics, is closing down.  Their report – Ticket Crime: Problem Profile February 2013 – published on 19 February 2013 makes for disturbing reading.  It identifies that ticket fraud in the UK alone makes £40 million per annum for the criminals behind the scams.

Operation Podium secured the cooperation of S.T.A.R. and most of the major primary ticket sellers in the industry and secured important convictions and largely prevented wholesale scamming in relation to Olympic tickets.  In the process they had to understand what they were combatting and found over 1,000 touts in the UK, some of whom “tour” Europe scamming events, and they identified that the secondary ticket marketplace is worth £1 billion per annum.

Given the scale of the fraud, it appears that service providers are not as cooperative as they could be in closing down sites and operations identified by the police.  Suspending fraudulent and unauthorised websites is difficult due to a lack of co-operation from many website hosts and registrars, and sometimes from the bank’s merchant acquirers, despite the fact that the fraud frequently rebounds on the credit card companies.  Fraudulent websites often appear high up in Search Engine results and pay for Sponsored Links and Adwords and the search providers can be slow to take them down.

Operation Podium unfortunately reports that the most common method for unauthorised ticket resellers and touts to obtain large numbers of tickets is from compromised contacts within sporting bodies, primary ticket agencies, concert promoters, venue operators and event sponsors.  In essence, the primary market leaks huge proportions of tickets to the secondary market.  The surreptitious way that large numbers of ‘primary’ tickets are diverted straight onto secondary ticket websites, often means members of the public have little choice but to try to source tickets on the secondary ticket market.

Unfortunately on-line ticket exchange websites allow professional ticket touts to re-sell large numbers of tickets via their websites.  As Channel 4’s Dispatches programme identified in 2012, large proportions of tickets on the secondary market as fan re-sales are in fact coming from illegitimate sources.

The Metropolitan Police make the bald statement: “The lack of legislation outlawing the unauthorised resale of tickets and the absence of regulation of the primary and secondary ticket market encourages unscrupulous practices, a lack of transparency and fraud.”  While the UK Government introduced the necessary legislation to regulate Olympic Tickets and Operation Podium was set up to enforce the law, the Coaltion in the UK has otherwise chosen to ignore the issue for a belief in self-regulation and market forces.  The evidence of the level of criminal activity and the nature of the persistent fraudulent sales cries out for some defence for the public, who, despite the best efforts of S.T.A.R., the Met points out “are unable to distinguish between authorised ticket websites, unauthorised ticket websites and fraudulent websites.”

The Ticket Crime: Problem Profile Report makes clear that Government action is needed: The primary and secondary ticket market requires regulation to ensure transparency, allowing consumers to understand who they are buying from.  Law enforcement needs to strengthen relationships with website registrars and hosting companies.

Ticket fraud is usually committed by organised criminal networks creating legitimate-looking websites, taking payment for event tickets and then failing to supply them. Reports vary, but some estimates indicate that as many as one in seven UK ticket buyers are defrauded by bogus ticket websites, and in 2010 it was estimated that half a million Britons were defrauded by bogus ticket sellers. The true scale of ticket fraud is unknown because the majority of those defrauded do not file a report with the police or Action Fraud.

Many people who suffer ticket fraud do not realise that a key part of the scam is to harvest credit and debit card details in full for use by criminals across Europe, so people suffer twice.  Ironically, the old-fashioned crime of “counterfeit tickets” is now much less significant that ticket fraud and the unauthorised resale of tickets.

Nick Downing, detective superintendent and head of Operation Podium, said: “We know that ticket crime is extremely under reported, and there is a lack of public awareness and understanding which means that people find it difficult to distinguish between an authorised, unauthorised or fraudulent websites. For these reasons it is important that ticket crime is properly tackled and the awareness is raised on how the public can take steps to protect themselves from becoming a victim of these crimes.”

Jonathan Brown of the Society of Ticket Agents and Retailers (S.T.A.R.), said: “This industry has never before benefited from such concentrated work to help uncover criminality and fraud which continue to cause detriment to the ticket buying public.”

Operation Podium concludes “Should the opportunity not be taken to pass legislation outlawing or controlling the resale of tickets, or to impose regulation across the primary and secondary ticket markets, the onus will be on the ticketing industry to regulate itself. Self-regulation is unlikely to be successful, given the current lack of transparency and unscupulous practices by some. The impetus for change may have to come from fans and performers”.

Perhaps the industry should demand consumer protection before the criminals destroy our credibility?

Full report: http://tinyurl.com/bcgoycf