The legality of ticket scalping largely depends on the laws and regulations in the state or jurisdiction where the event is being held. Some states prohibit ticket scalping altogether, while others regulate it in various ways such as imposing caps on resale prices or requiring scalpers to obtain a license. The rules can also vary for different types of events, with stricter policies often in place for popular concerts and sporting events.
What is ticket scalping?
Ticket scalping refers to the resale of tickets for a profit above their original face value. Scalpers typically obtain tickets through the standard sale, then resell them on secondary markets like Craigslist, eBay, or ticket resale sites. The practice allows scalpers to capitalize on events where demand dramatically exceeds supply.
Ticket scalping happens both electronically through online resale sites, as well as in-person outside of venues. For popular shows or games that are sold out, it’s common to see scalpers walking around near the venue trying to offload extra tickets before the event starts.
When did ticket scalping become a thing?
The practice of ticket scalping emerged in the early 1900s with the rise of entertainment events like concert tours and sporting events. With limited inventory and high demand, scalpers realized they could procure tickets and sell them for substantial profits to fans desperate to attend hot events.
Over the last century, ticket scalping has exploded into a massive industry worth billions of dollars each year. The Internet has made scalping much easier and more efficient by connecting scalpers with a huge base of potential buyers.
Is ticket scalping legal?
There is no federal law in the United States prohibiting ticket scalping, so its legality depends entirely on the local laws where the event is located. Many states have passed anti-scalping laws over the years, but they range widely in how strongly they restrict or regulate the practice.
Here are some examples of different state policies on ticket scalping:
- New York and Arkansas ban ticket scalping completely for any major event.
- California, Colorado, and Michigan have passed laws capping the resale price of tickets at certain percentages above face value. This essentially limits the potential profit scalpers can make.
- Ohio requires all ticket resellers to obtain a license before selling any tickets in the state.
- Pennsylvania mandates ticket resellers must disclose the original face value when advertising resale prices.
- Many states like Illinois and Florida have repealed their anti-scalping laws in recent decades and allow the practice to continue with few or no restrictions.
Some states make exceptions for ticket scalping laws for certain events like concerts or sporting events where scalping problems are most pronounced due to intense demand.
Arguments for allowing ticket scalping
There are a few common arguments made in favor of ticket scalping:
- It allows pricing to reflect true market value – Scalpers argue that they are simply setting prices for a scarce resource (in-demand tickets) based on what the free market will bear. Thisdynamic pricing accounts for the huge variance in demand over different events.
- It increases access and availability – By acquiring bulk tickets and reselling at various price points, scalpers essentially create a secondary market that allows more fans to purchase tickets.
- It discourages frivolous purchases – Scalped tickets are often very expensive for hot shows or games. This higher price point discourages people who aren’t huge fans from casually buying tickets just to resell them.
Supporters of scalping contend it’s a victimless crime where both buyers and sellers engage in transactions voluntarily. Fans willing to pay inflated prices can still see their favorite team or artist perform live.
Arguments against ticket scalping
Here are some common criticisms of ticket scalping and reasons why many see it as an unethical practice:
- It prices regular fans out of the market – Wealthy scalpers monopolize the initial ticket sale, making it much harder for average fans on a budget to purchase tickets at face value. This excludes less affluent fans.
- It exploits artists and teams – The artists, performers, teams, and venues don’t receive any benefit from scalped tickets being resold at a huge mark-up.
- It inflates prices unfairly – Scalpers did nothing to merit the higher prices other than buy up scarce tickets quickly. Critics see this as an unethically parasitic business model.
- It encourages bulk buying over individual sales – Scalpers often use bots or hired teams to sweep up huge blocks of tickets faster than the average individual can buy them.
Opponents view scalping as a manipulative business practice that damages fan culture and excludes people who can’t afford inflated secondary market prices.
Are ticket resale sites like StubHub legal?
Major ticket resellers like StubHub and Vivid Seats operate legally since they act as marketplaces connecting individual scalpers and buyers. They are essentially providing a platform for scalpers to list and sell their tickets.
However, these sites do have to follow applicable state laws. For example, in states like California that cap resale value, these sites prevent sellers from listing prices above the legal limits. And if a state requires reseller licenses or other registration, these sites will mandate that of anyone selling tickets through their platform.
Can you get in trouble for buying scalped tickets?
In states where anti-scalping laws are on the books, the legal penalties are almost always only directed at the resellers and not at the ticket buyers. It’s extremely rare for someone to face criminal charges just for buying scalped tickets, even in places where the scalping itself was illegal.
The only real risk for buyers is getting stuck with counterfeit or fraudulent tickets. There is less fraud protection when purchasing from unregulated scalpers versus major resellers like StubHub that vet sellers and guarantee valid tickets. But dealing with a scammer seller is a civil matter, not a criminal offense.
What events ban ticket scalping?
While each state has its own policies, ticket scalping tends to be more heavily restricted for major sporting events and hot concert tours where scalping runs rampant. Some examples include:
- NFL Playoffs and Super Bowl
- NCAA March Madness
- NBA Finals
- World Series
- Olympic Events
- Major rock concerts like U2, Bruce Springsteen, Rolling Stones
- Music festivals like Coachella, Bonnaroo, Lollapalooza
Venues may prohibit scalping on premises even when the state laws are lax on the practice. And artists like Bruce Springsteen have made efforts to thwart scalpers by requiring ID verification and capping ticket transfers.
Can you scalp tickets on eBay or Craigslist?
These online platforms essentially provide a marketplace for scalpers to connect with buyers, so they are certainly commonly used for ticket resale. However, sellers do need to follow certain rules and regulations:
- eBay and Craigslist both prohibit ticket sale listings that violate state ticket scalping laws. Sellers must comply with all applicable local regulations.
- These sites ban the use of software bots to purchase tickets in bulk for scalping. All tickets sold must be manually purchased.
- Sellers may be required to obtain a business license or reseller permit if mandated by the state.
- eBay and Craigslist charge various listing and selling fees that scalpers must consider.
These platforms generally allow ticket resellers to operate so long as they follow site policies, state laws, and avoid illegal activities like bots, fraud, and price gouging.
Tips for avoiding ticket scalping scams
For buyers looking to purchase tickets on the secondary market, here are some tips to avoid getting scammed by an illegitimate scalper:
- Use reputable resale sites like StubHub that guarantee valid tickets and have anti-fraud protections.
- Avoid sellers advertising on social media or other less secure platforms.
- Search online for seller reviews, complaints, suspicious activity before buying.
- Never pay with cash, always use credit card for fraud protection and documentation.
- Only buy e-tickets you can verify as authentic before sending payment.
- Be wary of prices that seem suspiciously low as well as suspiciously high.
Are ticket buying bots legal for scalping?
Ticket bots refer to computer software programs that can rapidly purchase large volumes of tickets the moment they go on sale to the public. Scalpers and brokers utilize these bots to sweep up thousands of premium seats within minutes, making it much harder for regular fans to buy tickets at face value through normal channels.
In 2016, President Obama signed the BOTS Act, making it illegal under federal law to use software to purchase event tickets for the purpose of resale. Violators can face fines up to $25,000 per offense. However, enforcement remains challenging as bot traffic can be difficult to detect and trace.
Prior to the BOTS Act, a few states including New York had passed their own laws banning ticket bots. Major ticket sellers like Ticketmaster are continuously working to improve bot detection systems and cap how many tickets a single user can purchase.
Final thoughts on ticket scalping
Views on ticket scalping tend to be mixed, as arguments exist both for and against the practice of reselling tickets at marked-up prices. There are reasonable ethical points on both sides of the debate.
In an ideal world, ticket prices would be fairly priced based on demand, and average fans would have a fair shot at purchasing seats without getting boxed out by scalpers. But in reality, that is rarely the case for mega popular events.
As live events continue thriving as a major entertainment industry, the divide between rabid super fans and casual listeners keeps growing. Scalping provides a way for the super fans to gain access, even if it comes at the exclusion of others.
Whether this market correction is seen as unethical price gouging or simple smart capitalism depends on your perspective. But with no uniform federal laws, the patchwork of state and local policies on scalping will remain a confusing mess for buyers and sellers alike.