The FBI has unraveled a years-long scheme to defraud streaming services with bot accounts and AI-generated music.
This RollingStone article describes a confusing scheme in which a gentleman set up a huge bot network to allegedly play and share AI-generated ripoffs of actual artists' music. Millions of dollars in payments were directed to fake accounts, with botnets on Spotify, Apple Music, and Amazon Music.
The case is a landmark development in the still-developing music streaming market, with the U.S. Attorney's Office for the Southern District of New York calling it the first criminal case involving artificially inflated music streaming.
In the indictment, the prosecutors say that for the past seven years, North Carolina musician Michael Smith had been running a complex music streaming manipulation scheme to fraudulently profit off of billions of streams from bot accounts. "At a certain point in the charged time period, Smith estimated that he could use the Bot Accounts to generate approximately 661,440 streams per day, yielding annual royalties of $1,207,128," the prosecutors said in the indictment announcement.
Smith, 52, was charged with wire fraud conspiracy, wire fraud and money laundering conspiracy, totaling to a combined maximum of 60 years in prison if convicted.
"Through his brazen fraud scheme, Smith stole millions in royalties that should have been paid to musicians, songwriters, and other rights holders whose songs were legitimately streamed," said Damian Williams, U.S. Attorney for the Southern District of New York. "Today, thanks to the work of the FBI and the career prosecutors of this Office, it's time for Smith to face the music."
RollingStone
Previously:
• Spotify accuses indie band of 'streaming fraud' over 8-year-old song name
