No Right To Approve Tour Support Spending - Traps & Scams Every Musician Must Avoid

If someone told you to trust them with the band credit card and said you did not need to worry, they are asking to be allowed to throw your money into a volcano with style. Welcome to the glamorous world of tour support accounting. This guide will make you laugh, make you furious, and then give you exact tools to make sure the people handling your cash do not ghost you with fake invoices and family side deals. This is practical survival training for musicians who want to tour without getting financially murdered.

We cover what tour support is, why labels, promoters, and production companies sometimes demand the right to spend it without asking you first, the most common scams, real life scenarios, and the exact contract language and actions you can use to protect yourself. Think of this article as a mix of legal self defense and street smart trickery prevention for touring artists.

What Is Tour Support

Tour support is money provided to an artist to cover touring costs. It can come from a record label, a promoter, a festival, or a brand partner. The goal is practical. The cash keeps the show happening and sometimes pays for production, travel, hotels, crew, and guarantees to opening acts. But here is the ugly part. Whoever controls the money often controls the story of how it is spent. If your contract says you have no right to approve spending, you are trusting someone else to decide whether your money bought soundcheck food or a cousin a new pickup truck.

Key terms explained

• Advance This is up front money that will usually be recouped from future earnings. Think of it as a loan against future revenue.
• Recoupment This is the accounting process where the party that gave the advance takes back their money from future income streams.
• Guarantee This is the payment promised to the artist for playing a show. It can be flat or conditional based on ticket sales.
• Per diem Daily allowance for meals and small expenses for each person on the tour.
• Settlement statement The accounting document that shows earnings and expenses after a show. It should list ticket revenue, guarantees, expenses, and show you what you are owed.
• Audit clause Contract language that gives you the right to inspect books and invoices to verify accounting.

Why Promoters Or Labels Want No Approval Rights

There are legitimate reasons for centralized spending. Promoters and production companies coordinate logistics. They buy equipment at scale and sometimes get trade discounts. They also accept risk. That said, giving someone the unilateral right to spend tour support without your approval is the same as giving them the remote with all the batteries missing.

Real reasons you might see that clause

• They want to move fast and handle bookings and vendors without sending every invoice to an artist.
• They want to protect their supply chain discounts and hold vendors accountable directly.
• They are counting on recouping their costs from the tour. This is standard but often abused when the accounting is opaque.
• They plan to net their own related party companies by routing invoices through them. That creates profit for the promoter or label from your support money.

How The Trap Usually Works

Here is a common script. The label gives a tour support advance to the artist. The contract allows the label to allocate the support to any touring costs. The label hires a production company that is a sister company to the label or is owned by someone with a close relationship to a label executive. That production company invoices the label for large sums with vague line items. The label recoups those costs from your royalties or future show income. You get a blurred settlement that shows production expense 15000, vendor fees 5000, and vague catch all 8000. You ask for receipts. The response is a one page PDF printout with totals and a promise that everything is OK. You have no audit rights. You need the money to keep going but now you are financially trapped.

That scenario is not hypothetical. We will walk through the most common variations and how to stop them before they start.

Top Scams And Traps To Watch For

Related Party Invoices

Someone you pay uses their own company or a family company as a vendor. The invoice is real. The price is padded. The vendor provides basic services that other companies could provide for cheaper. This creates a built in profit center for the party controlling the funds.

Real life scene

The tour production company invoices 25000 for lighting for a seven night run. You later discover a local provider quoted 6000 for the same kit. The production invoice came from a company owned by the promoter. You had no approval rights so you were never offered options.

Inflated Per Diem Or Phantom Crew

Per diems or crew numbers are exaggerated to generate extra revenue. The show settlement lists a crew of nine when the actual touring crew was four. The promoter pays per diem for nine people every day. That money disappears into a company bank account and the excess is not explained.

Real life scene

You arrive to a show to find only two stagehands doing setup. The settlement shows five. When you ask where the other three were the explanation is a shrug and a promise that they were on site earlier. You have no approval right to check staffing levels in advance.

Ghost Invoices And Duplicate Billing

Vendors are invoiced twice or for services that never happened. Without granular receipts and the right to audit, these items become unchallengeable charges deducted from your support cash or royalties.

Real life scene

An invoice lists catering for three dates. Your rider shows catering only for two dates. The promoter rolls the third date cost into your settlement as a legitimate expense. You notice only months later when the settlement is bundled with other tours and nobody answers calls.

Absence Of Line Item Detail

A single lump sum labeled production or expenses invites abuse. No specifics means no clear benchmark to compare fair market costs. Vague descriptions are a scamgeru2019s dream. They allow creative accounting and easy recoupment with no oversight.

Uncapped Contingency Fees

Contracts sometimes allow a contingency or miscellaneous line with no cap. That gives a vendor permission to spend your support on anything they claim relates to the tour. You may find thousands allocated to miscellaneous fees months after the tour and no documentation to match them.

Assignment Clauses And Novation

These clauses let the label or promoter assign their rights and obligations to other entities. That means your settlement could be routed through a company across the globe with zero transparency. Assignment allows scammers to hide behind corporate layers.

No Audit Rights Or Short Audit Windows

Without the right to audit, you cannot verify what was paid. Short audit windows that expire quickly stop you from reviewing records when you finally have time. This is how large bills can be treated as final and unchallengeable.

Complex Recoupment Waterfalls

Some contracts recoup advances from a list of income streams in a complex order. If tour support is recoupable against many different revenue lines, you might pay back the advance with your streaming revenue, merchandise, and future performance guarantees. That eats your long term income while the upfront spender looks like a savior because they funded the tour.

Story Time: Two Musicians, One Nightmare

Band A signed a support agreement early in their career. The label agreed to provide 100000 of tour support for a domestic run. The label could spend that without artist approval. The label hired a production company. The production company charged 70000. The artist received random settlement statements months later with totals that made zero sense. The label recouped 70000 from the bandu2019s future royalties and streaming revenue. The band was left with debts and fewer future royalties. They could not audit the books because the contract authorized the label to provide the final accounting and set a 60 day window to request an audit. The band did not notice the drain until years later.

Band B refused to sign anything that removed approval rights. They insisted on a line item budget and escrow release every two weeks. The promoter pushed back but the band walked if the contract was not changed. The promoter agreed. The band toured with a certified production company chosen jointly and got a clear settlement every week. They ended the tour with a small profit and zero surprises.

Exact Clauses To Ask For In Your Contract

You want to negotiate specific protections. Below are clauses you should push for. These are examples. Get a music lawyer to tailor final language to your situation. We do not provide legal advice. We provide practical guardrails you can ask your lawyer to draft and your team to enforce.

Approval Rights On Line Items

Artist shall have the right to approve any single expenditure over a set dollar amount. Artist approval shall not be unreasonably withheld. This creates a threshold for big spends. Pick a number that makes sense for your tour size.

Itemized Budget And Regular Reporting

Require the promoter or paying party to provide an itemized budget prior to the tour and weekly updates during the tour. Each update should include invoices and receipts for amounts invoiced and a running balance. With itemization you can see when numbers creep upward.

Independent Vendor Requirement

Payments may not be made to related parties or affiliates unless approved in writing by the artist. This prevents the promoter from routing money to a sister company. If there is a reason to use an affiliate, require competitive bids and written justification.

Escrow Or Draw Release Mechanism

Place the tour support money in an escrow account with delivery conditions tied to milestones. Release funds to the promoter in stages with required documentation. This limits the ability of anyone to spend the entire fund on day one.

Audit Rights With Reasonable Windows

Artist shall have the right to audit all records related to the tour support and expenses for a period of at least three years after final settlement. The audit shall be performed by an independent accountant at artist expense unless the audit reveals overcharges in excess of a reasonable threshold, in which case costs shall be borne by the promoter. This gives you time and teeth to check the books.

No Double Billing Clause

Invoices shall not include duplicate charges for the same services. If duplicate billing is detected the promoter shall promptly refund the amount and pay interest. This is common sense prevention language.

Cap On Contingency Or Miscellaneous Fees

Set a hard cap on contingency charges. If the contract allows a contingency, make it a small percentage of the total support and require explanations and receipts for each contingency draw.

Specific Recoupment Waterfall

Make recoupment rules explicit and narrow. Specify the order of recoupment and which revenue streams are protected. For example you can insist that tour support is recouped only from tour related income and not from streaming royalties or publishing income. That protects your long term earnings.

Interest And Late Payment Penalties

Require interest on late refunds or late accounting to incentivize timely and honest reporting. No one wants to be the person waiting for a cheque with nothing in the bank and a lawyer on hold.

Practical Steps To Protect Yourself Right Now

• Insist on a budget. Before any money moves, ask for a line item budget. If they refuse, walk away or demand escrow.
• Set approval thresholds. Make sure nothing over a certain amount can be spent without your signed approval.
• Use escrow. If possible, have support funds deposited in an escrow account with clear release conditions tied to invoices.
• Require receipts. No receipts, no payment. Simple rule. If the promoter says a vendor is too small to provide receipts, hire your own vendor.
• Forbid related party spending. Require that vendors be independent and provide proof of service delivery.
• Audit and holdbacks. Retain a small percent of the budget as a holdback until final reconciliations are provided and audited if necessary.
• Ask for payment timing. Stagger payments so that vendors are paid after the service has been confirmed.
• Bring your own production manager. If you can, hire someone you trust to oversee vendor performance and invoice accuracy.
• Keep your receipts too. If you or your team spend personal money, track it carefully. Small receipts add up and can be used to challenge broad settlement claims.

How To Spot Red Flags Immediately

• Refusal to put the budget in writing
• Requests for large upfront payouts with no escrow
• Frequent use of the word reasonable without definition
• Short audit windows that expire quickly
• Vendors with minimal online presence or a new company run out of a residential address
• Reluctance to provide vendor contact details for verification
• Price quotes that are much higher than market examples you can source in 10 minutes

How Recoupment Can Eat Your Future Income

Recoupment eats in ways that feel invisible until you get your next royalty statement and wonder why your streaming cheque looks like a math joke. If your tour support is recouped against publishing, streaming, and merchandising, you are paying back the tour with all future earnings. The worst part is that the accounting can be opaque. Labels and promoters can bury recoupment clauses in long contracts where the average artist skims and signs because they need to get out on the road.

Example math

Tour support 50000. Production expense claimed 45000. Label recoups 45000 using streaming revenue over three years. Your monthly streaming income goes from 2000 to 1300 because a chunk is being recouped. That is real cash vanishing forever from your pocket because a production invoice claimed top dollar and you had no audit rights.

What To Do If You Discover You Are Being Scammed

Document Everything

Save emails, screenshots, receipts, and any conversations about budgets and invoices. Documentation is your ammunition.

Ask For The Backup

Request detailed invoices, vendor contact details, and bank transaction records that support big numbers. Be polite but persistent. If the promoter resists, that resistance is itself a red flag.

Use Your Audit Rights Or Push For Them

If your contract includes audit rights, exercise them. Engage a forensic accountant experienced in music industry accounting. That will cost money but can be worth it if large sums are at stake.

Escalate To Your Lawyer

Send a formal demand letter. Lawyers can often push documents quickly where polite emails fail. If the other party remains evasive, legal action might be necessary.

Communicate To Your Team And Fanbase Carefully

Publicly calling someone a thief without proof can cause legal issues. Use factual language. If the community needs to know, share what you can with caution and avoid slander. Fans can help by demanding transparency from promoters and festivals. They have power at the box office.

Small Band Tactics That Actually Work

If you are not in the position to demand contractual changes because you are opening for a major act or you are an early career artist, there are still practical steps you can take.

• Ask for a simple rider that clarifies what will be covered and what will not be covered by support money.
• Request that any related party vendor be disclosed in advance in writing and that competitive bids be provided.
• Document your own expenses every day with photos and receipts and email them to your manager. A daily log helps during disputes.
• Negotiate per show settlements in writing with a clear timeline for payment and a holdback percentage.
• If you can, accept smaller guaranteed fees that pay cash at load in and negotiate production to be handled by the promoter while you control hospitality and rider costs.

How Managers And Agents Should Protect Artists

Managers and agents are your first line of defense. They should read every clause that touches tour support. Agents can negotiate guarantees and payment timing. Managers can insist on escrow and audit clauses. If your team is not fighting for those things you either need a better team or to do the negotiation yourself. Saying no to an exploitive contract is not career suicide. Walking away from a bad deal keeps your future income intact.

When To Say No To A Deal

Say no when the promoter or label refuses to provide a budget, when they insist on full control of spending without audit, when related party vendors are required without reason, or when recoupment eats income streams you cannot afford to lose. Saying no stings at first. It protects your career five years from now.

Checklist Before You Sign Anything

• Is the tour support amount clearly stated?
• Is there an itemized budget or timeline for one?
• Do you have approval rights above a reasonable threshold?
• Are related party vendors restricted or disclosed in writing?
• Is the money held in escrow for staged release?
• Are audit rights in place with a reasonable time window?
• Is the recoupment waterfall narrow and defined?
• Is there a cap on contingency and miscellaneous charges?
• Do you know who on the promoter side will sign invoices and be accountable?

FAQ

Can a promoter legally spend my tour support without my approval

It depends on the contract. If the agreement grants the promoter or label the right to allocate funds and does not require prior approval, they can spend the money within the terms of that contract. That is why contract language matters. If you do not give yourself approval rights you will often have no practical control. Always negotiate those rights or refuse the deal.

What if the promoter claims they must use their own vendors because of logistics

That is a reasonable claim in some cases. Insist on competitive bids, documented reasons for vendor selection, and limits on related party markups. You can allow logistical vendors while still protecting against inflated invoices and family companies profiting from your support.

How long do I have to audit settlement statements

Audit windows vary. Some contracts give only 60 days after final settlement. Others allow a few years. Ask for at least three years if you can. If you accept a short window make sure you are confident in the other party and have a full time team tracking expenses during and immediately after the tour.

Can I refuse to let my royalties be used to recoup tour support

That depends on your contract. Negotiate recoupment limitations. If your record deal allows recoupment from all income streams you may be forced to repay with royalties. Limit recoupment to tour related income if possible. If the contract has already been signed you will need legal help to renegotiate or challenge specific charges.

What documentation should I receive during the tour

Weekly itemized statements, copies of invoices and receipts for all material expenses, vendor contact information, a list of crew on payroll with days worked, and a running balance that shows how the support money is being allocated. The more frequent the reporting the less chance for a surprise.

Is it realistic to get an escrow arrangement for tour support

Yes. Escrow protects both sides. The promoter knows the funds are available and the artist knows the funds are released only after documentation. For larger tours escrow is common. For small shows promoters will resist. Evaluate the size of the deal and your leverage and push for escrow when meaningful sums are at stake.

What if I discover a related party scam after the tour

Collect documentation. Use audit rights. Hire an accountant to review invoices. If overcharges are discovered demand refunds through legal counsel. If the amounts are significant litigation or arbitration may be necessary. Keep calm and document everything. Public pressure can help but avoid allegations without evidence.

How much should I cap contingency at

Contingency caps should reflect tour complexity. For simple tours 2 to 5 percent is reasonable. For complex international tours 7 to 10 percent could be fair. Keep the number explicit and require justification and receipts for any contingency draw.

Can I require competitive bids for vendors

Yes. A clause requiring at least two or three competitive bids for major line items is reasonable. It protects against inflated pricing and related party deals. Vendors should be evaluated on price and quality. If the promoter refuses this you should ask why.

Get Contact Details of Music Industry Gatekeepers

Looking for an A&R, Manager or Record Label to skyrocket your music career?

Don’t wait to be discovered, take full control of your music career. Get access to the contact details of the gatekeepers of the music industry. We're talking email addresses, contact numbers, social media...

Packed with contact details for over 3,000 of the top Music Managers, A&Rs, Booking Agents & Record Label Executives.

Get exclusive access today, take control of your music journey and skyrocket your music career.

Unlock Instant Access