Wiseguys Plead Guilty

The founders of a ticketing company that used high-tech programs to speed through ticketing websites recently pleaded guilty to federal fraud charges in a New Jersey court.

Kenneth Lowson, Kristofer Kirsch and Joel Stevenson reportedly netted more than $25 million as the operators of Wiseguy Tickets, which resold tickets at a mark-up to brokers between 2002 and 2009.

Lowson and Kirsch pleaded guilty Nov. 18 to conspiracy to commit wire fraud and could face up to two years in prison plus $250,000 in fines. Lowson also agreed to surrender all proceeds of the crime, including more than $1.2 million and previously-seized computer equipment.

Stevenson pleaded guilty to a misdemeanor charge of unauthorized access to computers engaged in interstate commerce. He faces no more than one year in prison and a $100,000 fine.

During court proceedings, the government alleged the company worked with programmers in Bulgaria to create a network of computers to flood ticket sites’ computers during onsales, using bots to speed through CAPTCHA challenges.

To conceal their identity, Wiseguys also reportedly established a network of computers in the U.S. that impersonated individual visits to the sites of companies including Ticketmaster, LiveNation and Tickets.com.

U.S. Attorney Seth Kosto said in court that the men were able to purchase more than 1 million tickets to high-demand events, according to Newark’s Star-Ledger.

Artists targeted by the Wiseguys operation included Bruce Springsteen, Hannah Montana, Bon Jovi, Barbra Streisand, Billy Joel and Kenny Chesney. In one instance, the company managed to score nearly half of the 440 floor tickets for a July 2008 Springsteen concert at Giants Stadium in East Rutherford, N.J.

Attorneys for the Wiseguys argued in court that the scheme wasn’t criminal; the men had simply invented a better mousetrap to score tickets.

Prosecutors in the case saw things differently.

“These defendants made money by combining age-old fraud with new-age computer hacking,” U.S. Attorney Paul Fishman said in a statement. “Their guilty pleas confirm that no matter what they called their activities, they were criminal violations of federal law.”