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The Federal Trade Commission has filed a lawsuit against US-based ticket reseller, accusing the company of illegally bypassing Ticketmaster’s security systems to purchase and resell hundreds of thousands of tickets.

Getting into it: The lawsuit, filed on August 18 in US District Court in Maryland, accuses Key Investment Group (KIG) of using a sophisticated and large-scale scheme to bypass Ticketmaster’s security measures. According to the Federal Trade Commission (FTC), KIG purchased at least 379,776 tickets over a one-year period, spending nearly $57 million and reselling them for approximately $64 million, netting a profit of over $7 million. The purchases spanned popular live events, including 2,280 tickets to 38 Taylor Swift Eras Tour concerts, which alone generated more than $1.2 million in profit. In one example cited by the FTC, KIG used 49 different Ticketmaster accounts to buy 273 tickets to a single Swift show, violating the six-ticket-per-customer limit.

To achieve this, the FTC alleges KIG exploited technical loopholes and obfuscation techniques, including the use of thousands of fictitious and third-party Ticketmaster accounts, spoofed IP addresses, SIM cards to intercept verification codes, and virtual credit card numbers to obscure the origin of purchases. These tactics were allegedly used to “circumvent a security measure, access control system, or other technological control or measure” implemented by Ticketmaster—actions that the FTC claims are a direct violation of both the FTC Act and the Better Online Ticket Sales (BOTS) Act.

In response to the lawsuit, KIG issued a statement to CBS News, rejecting the allegations and framing the suit as an attack on the secondary ticketing market. “KIG will vigorously defend itself against this clear example of regulatory overreach,” the company said. It further argued that the FTC’s claims were based on a misinterpretation of its practices, stating, “The FTC misleadingly characterizes KIG’s use of standard internet browsers,” and warned that the government’s actions “threaten to dismantle the secondary ticket market for live events.”

In a statement, FTC Chair Andrew Ferguson said, “Today’s action puts brokers on notice that the Trump-Vance FTC will police operations that unlawfully circumvent ticket sellers’ purchase limits, ensuring that consumers have an opportunity to buy tickets at fair prices.”