According to the article titled “Secret Deals Jack Up Prices For Concert Tickets,” a six-week investigation by the newspaper revealed that SFX “sells nearly 200 prime seats to every show at Irvine Meadows Amphitheatre exclusively to ticket brokers … .”

The situation at the Southern California venue is especially interesting because the seats sold to Mike’s Tickets are not available through the Irvine Meadows box office or Ticketmaster. In fact, they don’t even appear on the shed’s seating chart.

SFX CEO Mike Ferrel told the Times that the “phantom” seats sold to Mike’s Tickets are part of a longstanding agreement that the company “inherited” when it bought the venue from the the previous owner.

“The seats in that section are part of a box seat program that has been in place for many years,” Ferrel said. “To the extent that those transactions represent any dealings with scalpers, it’sdue to previous commitments, which we are trying to extricate ourselves from.”

The transactions with Mike’s Tickets were apparently never disclosed to the artists who perform at the venue, and the revelation has stunned artist managers and booking agents contacted by the Times.

Since the deal with the ticket broker circumvents standard ticket-selling channels, and the phantom seats don’t even appear on seating charts, the artists do not see any profit from the sale of those tickets.

The article went on to explain that SFX is not the only promoter selling tickets directly to scalpers. House of Blues was also named, and artist managers were said to be involved in the practice as well.

“It’s the concert industry’s dirty little secret,” Tom Ross, founder and former head of Creative Artist Agency’s music division, told the paper. “The big scalpers move nearly 2,000 tickets to every event in every major market. It’s wrong. It’s unethical. And in some cases, it’s a breach of contract to the artists, who are the reason all of this money is generated in the first place.”