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When U2's long-running fan club Propaganda was transferred over to Live Nation in 2005, their seniority ranking system was erased, which resulted in a great many tickets reserved for fan club members ending up in the hands of scalpers.

Fan clubs for newer artists like Justin Bieber have been gamed from the start, with industrious scalpers joining up early on, anticipating long-term demand for tickets for his shows.

Long-running fan clubs, like Dave Matthews Band's Warehouse and Pearl Jam's Ten Club, are highly regimented and prioritize members by seniority.

This seniority system rewards long-term fans, but it is mostly there to keep scalpers from joining up and exploiting the system.

Managers and labels buy tickets for guest list, and those tickets are given away for free to friends and family, press, and industry figures at their discretion.

The number of tickets set aside for this purpose can vary wildly, but there are occasions when a large number of available tickets for a small gig will be reserved for this if the show is intended mainly to generate press for the artist.

"Brokers snatch up at least 50%, if not more, of these tickets," says Josh Baron, coauthor of Ticket Masters: The Rise of the Concert Industry and How the Public Got Scalped, noting that scalpers typically use multiple credit cards to pick up these tickets and flip them on Stub Hub, Tickets Now, and other legit secondary market sites.

"Many of them pay the money, if they need to, or simply divulge a variety of email addresses they have to be part of those fan clubs." Managers — and sometimes artists themselves — regularly sell their allotment of tickets on the secondary market to the highest bidders.

This is mostly a positive thing, but as with all presales, it reduces the number of tickets available in the general sale.

In most cases, fans must join the artist-sanctioned club and pay yearly dues in order to have this privilege.

They are sophisticated programs that can be custom-built for a regular user, or more generically designed and leased out.

Captcha was designed to weed out bots, but scalpers have learned to circumvent this with a method called "manual turk," in which a pool of outsourced workers — usually in India or the Philippines — manually type in the Captcha text after the initial work is done by the bots.

This happens at large venues too, albeit more rarely.

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