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Jason Nissen facing jail time after guilty plea

Jason Nissen, the New York-based former ticket reseller accused of operating a a multimillion-dollar ponzi scheme, has pledged to repay his victims after pleading guilty to wire fraud.

Nissen and eight of his companies are accused of funnelling more than US$120m through a fraudulent scheme in which investors were promised “impossibly high returns” on resold tickets for events including Broadway musical Hamilton, Adele’s Adele Live 2016/2017 world tour, the Super Bowl and several other sporting events.

In reality, alleged prosecuting lawyers Morrison Cohen, “the ‘returns’ on the ticket sales were illusory, financed by cash infusions from new investors who were told their money would be used to purchase tickets for resale”.

Last June, a New York court ordered the seizure of cash, property, shares and other assets from Nissen, who allegedly conned investors out of $32m to prop up what the prosecution described as a “basic yet audacious” ticket-selling scam. One of his companies, National Event Company (Neco), was later given the go-ahead to sell its remaining inventory of approximately 11,000 tickets, after successfully arguing the tickets would otherwise become worthless.

“I wish to apologise to those who trusted me with their investments and loans”

Nissen yesterday pleaded guilty to a single count of wire fraud – fraud committed using electronic communications – before district judge Paul Engelmayer in Manhattan, reports Bloomberg Markets.

Nissen told Engelmayer he borrowed money from investors to buy large quantities of tickets, often at high interest rates, but was forced to seek more funding due to poor sales and “other business problems”.

“I know that my conduct was wrong and I wish to apologise to those who trusted me with their investments and loans and for any harm I have caused,” he said, adding he would work to repay investors.

The maximum sentence for wire fraud, if convicted at trial, is 20 years in prison, although Nissen’s plea agreement reportedly calls for him to serve between five and just over ten years when he is sentenced on 21 August. He also faces a fine of as much as $250,000 – or twice the gain to him or the loss to others – and will be ordered to pay investors $65–72m in restitution.

 


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Neco OK to sell final 11,000 tickets, court rules

Defunct ticket resale operation National Event Company (Neco) has been granted permission to sell its remaining inventory of approximately 11,000 tickets, after successfully arguing in a New York bankruptcy court the tickets would otherwise become worthless.

Neco filed for bankruptcy last month after bank accounts and other assets belonging to its founder, former maths teacher Jason Nissen, were seized by sheriffs in connection with an alleged US$120 million ponzi scheme.

In a court filing yesterday, judge James L. Garrity, of the bankruptcy court of southern New York, approved Neco’s request to sell the inventory, which Nissen says includes tickets to a number of baseball matches, the US Open tennis championship and “concerts at Jones Beach [Theatre], PNC Arena in Newark and other venues”.

“Unless such tickets are sold promptly, there is a risk that they will not be sold at all”

Neco’s motion for permission to sell the tickets centred on two arguments: That revenue from their sale would allow it “to terminate all remaining full-time employees, other than its chief restructuring officer, and will allow the debtors to terminate their existing office lease at 1430 Broadway shortly, which together will substantially reduce operating expenses”; and that many of the events are scheduled for “dates in the near future”, meaning if the tickets are not sold immediately, “there is a risk they will not be sold at all”.

Neco’s lawyer, Herrick Feinstein’s Stephen B. Selbst, has previously estimated the value of the tickets to be around $5.2m.

 


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Nissen assets seized over $120m ticket ‘scam’

A New York judge has ordered the seizure of cash, property, shares and other assets from a ticket broker who allegedly conned investors out of US$32 million to prop up a “basic yet audacious” ticket-selling scam.

Jason Nissen and eight of his companies are accused of funnelling more than $120m through a ponzi scheme in which investors were promised “impossibly high returns” on resold tickets for events including Broadway musical Hamilton, Adele’s Adele Live 2016/2017 world tour, the Super Bowl and several other sporting events. In reality, allege prosecuting lawyers Morrison Cohen, “the ‘returns’ on the ticket sales were illusory, financed by cash infusions from new investors who were told their money would be used to purchase tickets for resale”.

The two investors who brought the lawsuit, Taly USA Holdings and SLL USA Holdings, said in the initial complaint they have been “damaged in an amount to be determined at trial, but believed to be in excess of $25m, plus interest”.

According to the complaint, Nissen confessed he had faked financial documents in order to secure investment from Taly and hide the scam from other investors. “They’re inflated numbers,” he allegedly told Taly’s Yaron Turgeman in a phone conversation. “We really had those events and really sold the tickets and they’re inflated, you know, two- to three-fold depending on how it was.”

In a court order yesterday, judge O. Peter Sherwood authorised New York sheriffs to seize five of Nissen’s bank accounts, his stocks and shares in two companies (New World Events Group and National Events of America) and two properties, both in New York, with all monies held until the conclusion of the case.

“The ‘returns’ on the ticket sales were illusory, financed by cash infusions from new investors”

In addition, Nissen is forbidden from making “any sale, assignment or transfer” or property or money “in which the defendants have an interest as will satisfy $25m” to any person other than a sheriff.

While the case continues, Sherwood says he believes the Taly and SSL “have a cause of action for a money judgment against the defendants for no less than $25m” and that “plaintiffs are likely to succeed”.

Nissen’s National Event Company (NEC) was part of the National Association of Ticket Brokers (NATB), roughly equivalent to the Association of Secondary Ticket Agents (ASTA-UK) in the UK, prompting criticism from some outlets about the association’s effectiveness in policing its members.

In a response provided to TicketNews, NATB says the criticism is unfounded, suggesting it is “outlandish […] to suggest that our trade association should have known about it and taken measures about it before law enforcement did”.

NEC’s website was still up as late as yesterday, although it now shows an “under construction” page. National Event Holdings has reportedly filed for bankruptcy.

Hamilton last summer became the most expensive ticket in Broadway history after producers raised the price in response to touts taking a reported $30,000 out of every show.

 


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