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Record executives say some hits may be scams

That big hit record rocketing up the Billboard charts may turn out to be a dud that's getting behind-the-scenes help.

Top record industry officials told the Los Angeles Times they are aware of instances in which major labels have attempted to manipulate sales figures.

These executives say a coterie of independent consultants and merchants from Los Angeles to New York have developed a system to distort sales numbers that are reported to SoundScan, the research firm that was supposed to clean up the once-shadowy world of music sales.

The scheme isn't complicated: It involves retail clerks swiping a CD numerous times across a scanning machine to falsely boost sales figures.

"It's a real problem," said George Zamora, president of WEA Latina, the U.S. sector of AOL Time Warner's Latin music division. "It's happened a number of times."

Billboard chart chief Geoff Mayfield said he is aware of efforts to distort sales figures. SoundScan chief executive Mike Shalett said the company has found troubling anomalies in sales data.

Representatives of the five major record companies denied knowledge of any label in their organizations participating in any schemes to enhance sales figures.

It is unclear how often manipulation occurs or how many record companies participate. Shalett declined to name which labels or retailers may have participated. "We have security measures in place, though," he said. "We catch them."

Several executives said the scheme works like this:

A label hires an independent consultant to ship free CDs of a new release to a select group of small, independent record stores across the country. In return, the retailers agree to swipe each CD numerous times over bar-code scanning devices at cash registers to make it appear as if more copies of the album are sold. The trumped-up sales figures are fed into SoundScan's computerized accounting system.

Before SoundScan's arrival 10 years ago, charts were based on verbal reports made by retailers who, executives say, were easily corrupted with gifts and money from record labels. SoundScan introduced a computerized system to register sales. The company tracks sales in 18,000 music stores, extrapolates the data using weighted samples and delivers a final tally to subscribers every Wednesday morning.

SoundScan's computer system revolutionized the business by rearranging the pecking order of pop music, allowing virtually unknown acts to elbow out established superstars in the weekly sales race.

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