Consumer watchdogs around the world warn of Viagogo
A Harvard University graduate is the man behind controversial ticket reselling website Viagogo which is being used by scalpers as a platform to scam concert-goers around the world.
Viagogo, founded by American businessman Eric Baker in 2005, is being investigated by the Commerce Commission for alleged false and misleading representations, which could breach the Fair Trading Act.
Viagogo is an online platform that is used by people to buy and sell tickets to events and concerts. In New Zealand, many consumers have been left out of pocket, and with fake tickets, to concerts such as Celine Dion, Ed Sheeran, Shania Twain and Bruno Mars.
Numerous emails to the Swiss-based company have gone unanswered, however, one response refered back to Viagogo's frequently asked questions section, which does not have information about what victims of scalpers can do.
* Consumer watchdog investigating Viagogo after 'wave of new complaints'
* Bruno Mars: Kiwis left out in cold after scalped tickets prove invalid for Auckland show
* Consumer NZ says action needed on ticket resellers like Viagogo
Consumer NZ has previously called for action against Viagogo after it found 89 per cent of complaints about hidden fees related to the company.
The report said consumer exploitation was rife in online ticket resellers market, especially Viagogo, StubHub, Ticketmaster Resale, GetMeIn and Seatwave.
Commission consumer manager Stuart Wallace said he was seeking legal advice on how consumer laws could be enforced against the Swiss company.
So what is Viagago, who pulls the strings, and what protections do they have in place for consumers?
Eric Baker is described by The Guardian as Viagogo's charismatic, but reclusive, founder and chief executive.
Born to a wealthy business dynasty in Los Angeles, he was educated at Harvard and Stanford, before going on to co-found ticket resale business StubHub with his classmate Jeff Fluhr.
Fluhr, who owned more shares than his partner, parted company with Baker after the pair fell out, but both became multimillionaires when the company was sold to eBay for US$307m (NZ$420m) in 2007, according to The Guardian.
Baker then went on to found Viagogo, as a European version of StubHub and moved to London where he worked out of an expensive apartment in Knightsbridge.
Baker reportedly owns Viagogo through a company called Pugnacious Endeavors, based in Delaware, the United States state that is "synonymous with financial secrecy".
Viagogo's investors include former tennis stars Andre Agassi and Steffi Graf, investment banker Lord Jacob Rothschild, of the prominent British banking family, and billionaire Bernard Arnault, chief executive of luxury French conglomerate Louis Vuitton Moet Hennessy.
Tears, disappointment, and frustration
The commission received 228 complaints about Viagogo by Tuesday, including claims it was parading as an official ticket seller rather than as a reseller, additional fees were not being adequately disclosed, and consumers were being sold fake tickets.
Some consumers also complained they were not receiving the tickets they bought and were not able to contact Viagogo for a refund.
One woman, known only as Jody, broke down in tears after finding out the two tickets she had bought to Bruno Mars were invalid. She paid more than $1100 for them on Viagogo and was told they were fake at the concert gates.
Jody claimed at least 10 people discovered their reseller-sourced tickets were invalid.
Meanwhile, Christchurch woman who was burned after buying tickets for her daughter and grandson to an earlier Bruno Mars concert.
And first-time concert-goer Vanessa said she had bought fake tickets to Ed Sheeran's show in Dunedin later this month.
'Don't buy from Viagogo'
That's the advice from Consumer NZ research writer Jessica Wilson.
"Go to the authorised ticket seller instead. It's your best protection against ticket touts," she said.
Wilson's top tip to avoid getting stung was to never click on the top result when searching for tickets online.
"It's likely to be a ticket reseller that has paid to appear at the top of the list," she said.
Also, people should pay for tickets by credit or debit card, because if something went wrong, consumers may be able to get money back, Wilson said.
On Wednesday, the commission renewed its warning, advising consumers to "seriously consider whether buying tickets from ticket reselling website Viagogo is worth the risk".
Consumer manager Stuart Wallace said the watchdog was concerned previous warnings about the risks of ticket resale were not getting through.
"We strongly advise consumers to have their eyes wide open if they are considering buying tickets from Viagogo."
He recommended buying tickets from primary ticker sellers, rather than re-sellers.
Ticket reselling, including at a profit, is generally legal in New Zealand, unless the seller engages in misleading conduct, or the event is covered by the Major Events Management Act, such as the Rugby World Cup 2011 and the Lions Tour 2017.
The fine print
Viagogo, which employs between 200 and 300 staff, says on its website that buyers are guaranteed to receive valid tickets in time for the event.
And in the "rare instance" a problem arises, Viagogo will, at "its sole and absolute discretion", offer replacement tickets at no additional cost, or issue a refund.
However, here are strict time restrictions to make a claim.
Buyers who receive genuine tickets must report the issue to Viagogo within 14 days to be covered by its guarantee.
If a problems with tickets is discovered on the day of the event, the customer must contact Viagogo within 48 hours.
Viagogo makes its money by taking a cut from the buyer and the seller, according to its website,
Buyers are forced to pay a service fee on top of the ticket price. This fee disclosed in the check-out process.
Viagogo says the fee covers the cost of maintaining the platform, guaranteeing tickets and providing customer service.
Meanwhile, sellers are also charged a fee to cover the cost of marketing tickets to millions of potential buyers worldwide.
Has Viagogo been banned in other countries?
Complaints against Viagogo have occurred around the world, but the company has not been banned from any country.
The Australian Competition and Consumer Commission has filed a case in the Australian Federal Court accusing the Viagogo of of misleading or deceptive conduct.
However, Google has barred ticket resale companies from claiming to be an "official" source of tickets in Google results.
Google also requires resale platforms to prominently disclose if a ticket price is higher than face value.
Resale sites must also be certified by Google before they can use its search result ranking service.