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Welcome to Wiley’s update on recent developments and what’s next in consumer protection at the Consumer Financial Protection Bureau (CFPB) and Federal Trade Commission (FTC). In this newsletter, we analyze recent regulatory announcements, recap key enforcement actions, and preview upcoming deadlines and events. We also include links to our articles, blogs, and webinars with more analysis in these areas. We understand that keeping on top of the rapidly evolving regulatory landscape is more important than ever for businesses seeking to offer new and ground-breaking technologies.
Regulatory Announcements
Justice Department and FTC Announce First Enforcement Actions for Violations of the Better Online Ticket Sales Act Details Written by IVN
Washington, DC - The Department of Justice, together with the Federal Trade Commission (FTC), today announced three settlements resolving alleged violations of the Better Online Ticket Sales (BOTS) Act. These are the first enforcement actions that the department and the FTC have brought under the BOTS Act.
Enacted in 2016, the BOTS Act aims to prevent ticket brokers from buying large numbers of event tickets and reselling them to interested customers at inflated prices. To achieve that goal, the BOTS Act prohibits a person from circumventing access controls or measures used by online ticket sellers (such as Ticketmaster) to enforce ticket-purchasing limits. It also prevents the resale of tickets obtained by knowingly circumventing access controls.
Tuesday, January 26, 2021
Last week marked a double milestone for the FTC: Rebecca Slaughter assumed the role of Acting Chair, and the agency brought its first enforcement action under the Better Online Ticket Sales Act (“BOTS Act”), 15 U.S.C. § 45c(a)(1).
Enacted in 2016 but somewhat dormant until now, the BOTS Act entitles the FTC to proceed against any person who “circumvent[s] 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 rules.” The statute is meant to address ticket resellers using programs or other pieces of technology like bots to instantly buy up hundreds or thousands of tickets to a concert or game as soon as they go on sale, only to sell them again at a massive upcharge.
FTC Fines Online Ticket Scammers In Trio of First-Time BOTS Act Cases
January 25, 2021
The Federal Trade Commission (FTC) has requested the judicial approval of three agreements reached with ticket scalpers concerning their orchestration of an online scheme that earned the New York men and their companies millions in allegedly ill-gotten proceeds. The FTC’s legal action against Cartisim Corp. and Simon Ebrani, Just In Time Tickets, Inc. and Evan Kohanian, and Concert Specials, Inc. and Steven Ebrani began with complaints filed earlier this month alleging that the defendants illegally purchased more than 150,000 tickets to concert and sporting events and resold them at a higher price, violating of the 2016-enacted Better Online Ticket Sales (BOTS) Act.
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The companies and their bosses, Evan Kohanian, Simon Ebrani, and Steven Brani, have been ordered to pay £2.7m between them by the FTC (Federal Trade Commission), lowered from $31m (£22m) due to their inability to pay the fines.
A summary of the court case reads: “The three ticket brokers will be subject to a judgment of more than $31 million in civil penalties for violating the Better Online Ticket Sales (BOTS) Act, under a proposed settlement reached with the FTC. Due to their inability to pay, the judgment will be partially suspended, requiring them to pay $3.7 million.
The FTC’s chairwoman Rebecca Kelly Slaughter added in a statement: “The Act’s bipartisan sponsors sought to crack down on the abuses that unscrupulous actors inflict on consumers whose typing fingers were no match for algorithms in attempting to secure tickets online.