Live Nation’s Ticketmaster has agreed to pay a $10 million criminal fine in order to sidestep prosecution on charges that it hacked a competitor’s computer system to steal confidential information, according to the U.S. Department of Justice.
“Ticketmaster employees repeatedly — and illegally — accessed a competitor’s computers without authorization using stolen passwords to unlawfully collect business intelligence,” Acting U.S. Attorney Seth DuCharme said in a press release on Wednesday (Dec. 30).
“Further, Ticketmaster’s employees brazenly held a division-wide ‘summit’ at which the stolen passwords were used to access the victim company’s computers, as if that were an appropriate business tactic,” DuCharme added.
Ticketmaster employees are accused of repeatedly using stolen passwords to hack computers belonging to its competitor Songkick. Headquartered in Brooklyn, New York, Songkick is a concert discovery service owned by Warner Music Group.
The U.S. Department of Justice reached a deal with Ticketmaster before U.S. District Judge Margo Brodie at the federal courthouse in Brooklyn. Terms also include a three-year deferred prosecution agreement, according to the release. The deal resolves the five criminal counts including wire fraud, conspiracy and computer intrusion.
Another provision of the deal requires that the Los Angeles, California company keep updated compliance and ethics procedures to stop cybercrime. Further, Ticketmaster will have to report to the U.S. Attorney’s Office annually during the three-year term of the agreement.
If the agreement is breached, Ticketmaster will be subject to prosecution for the original charges — one count of conspiracy to commit computer intrusions; one count of computer intrusion for commercial advantage; one count of computer intrusion in furtherance of fraud; one count of wire fraud conspiracy; and one count of wire fraud, the Department of Justice said.
In a related charge, Zeeshan Zaidi, the former head of Ticketmaster’s Artist Services division, pleaded guilty last year before Judge Brodie, to conspiring to commit computer intrusions and wire fraud. He and another employee were fired by Ticketmaster in October 2017.
In a statement released late Wednesday (Dec. 30), Ticketmaster said: “Ticketmaster terminated both Zaidi and Mead in 2017, after their conduct came to light. Their actions violated our corporate policies and were inconsistent with our values. We are pleased that this matter is now resolved.”