‘This is a case about greed:’ Federal prosecutors say scheme fleeced White Sox out of hundreds of thousands in ticket sales

·4 min read

Former White Sox employee James Costello had worked in the team’s ticket sales booth for more than three decades when, federal prosecutors allege, ticket broker Bruce Lee persuaded him to betray the team’s trust.

For years, Lee, 35, owner of Chicago-based brokerage Great Tickets, would pass Costello an envelope full of cash, and Costello would pass back an envelope of tickets that, using insider knowledge, he had fraudulently procured for free or at a heavy discount. Lee would then sell the tickets on the online resale forum StubHub, prosecutors said.

The White Sox got nothing.

Federal prosecutors in opening arguments on Friday laid out a complex ticket fraud scheme they alleged was perpetrated by Lee and two White Sox employees, Costello and William O’Neil.

Lee is standing trial before U.S. District Judge Matthew Kennelly, accused in an indictment of 11 counts of wire fraud and two counts of money laundering. Costello and O’Neil previously pleaded guilty and agreed to cooperate.

“This is a case about greed,” Assistant U.S. Attorney Matthew Schneider told the jury.

Lee’s attorney, though, countered in his opening arguments that the real perpetrators of the fraud were Costello and O’Neil. Attorney Nishay Kumar Sanan said that Lee thought he was paying the White Sox and tipping Costello when picking up the tickets. He didn’t know the employees were pocketing the money, Sanan said.

“The crime that took place happened behind the booth,” Sanan said.

In the indictment, prosecutors alleged that Costello and O’Neil used identification codes belonging to other team employees to generate complimentary and discount game tickets in exchange for cash payments without receiving the required vouchers. Prosecutors also said the two generated tickets using codes meant for vouchers for people who had purchased a ticket for a rained-out game.

Costello and O’Neil provided the tickets to Lee, their middleman, who sold them on StubHub at prices below face value, the charges allege.

The indictment, filed last year, claims Lee earned more than $860,000 by selling nearly 35,000 tickets over four baseball seasons from 2016 to 2019.

In October 2018, a White Sox analyst noticed the large amount of tickets sold by Lee on Stub Hub at below face value, Schneider said. Officials suspected Lee had inside help and called the authorities.

The analyst “determined the defendant was selling discount voucher tickets ... at a rate higher than anyone,” Schneider said.

When federal investigators traced the ticket sales to Costello and O’Neil, Costello agreed to tape conversations between himself and Lee, prosecutors said. In a recorded meeting at a pizza place near Sox park, Lee accepted more tickets from Costello, Schneider said.

He also told Costello the source of the Sox tickets could not be traced because the bar codes changed when he posted the tickets for sale, according to the indictment.

“I just sold them on StubHub, so nobody could see, like how much I paid for the tickets, that’s why I always told you … no way they could see it,” Lee was quoted by prosecutors as saying.

But Sanan was adamant that Lee knew nothing of the fraud. He said it was common practice for people to tip White Sox ticket sellers and that his client didn’t have any knowledge of the coupon codes required to fraudulently print the tickets.

“When they printed the tickets and took Bruce Lee’s money, they were the ones who chose not to pay the White Sox,” Sanan said.

Costello testified Friday as the prosecution’s first witness against Lee, and told the jury how he exploited a lax ticket sales system. Costello said all ticket sellers shared a common password — whitesox1 — which allowed him to log on and print tickets with others’ information.

“There was no monitoring and I knew that,” Costello said.

The trial will continue next week.

In 2007, Lee pleaded guilty in Cook County court to a misdemeanor count of “selling tickets not in a box office” and was sentenced to a day in jail, records show.

On two other occasions in 2007 and 2008, he was charged with ticket-related offenses, but both cases were dropped.

mabuckley@chicagotribune.com

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