Michael Smith, a North Carolina man, has been sentenced to 18 months in prison for using artificial intelligence (AI)-generated songs and automated streaming accounts to fraudulently obtain more than $8 million in music royalties.
According to the US department of justice, the 54-year-old
was sentenced on October 6 by a US federal judge after pleading guilty to
conspiracy to commit wire fraud.
He was also sentenced to two years of supervised release and
ordered to forfeit $8,091,843.64 obtained through the scheme.
The department said Smith carried out the fraud between 2017
and 2024, creating thousands of fake accounts on music streaming platforms,
including Spotify, Apple Music, Amazon Music, and YouTube Music.
He allegedly used software to make the accounts repeatedly
stream songs he controlled, most of which were generated using AI.
According to prosecutors, Smith created hundreds of
thousands of AI-generated songs and distributed the artificial streams across
thousands of tracks to avoid detection by the platforms’ anti-fraud systems.
At the height of the operation, he used as many as 10,000
automated accounts simultaneously, generating billions of streams and
collecting royalties from the platforms.
The scale of the operation was highlighted in April 2023,
when Smith’s accounts generated 80.9 million streams for his AI-generated music
on YouTube Music through family plans, compared with 9.3 million streams for
Taylor Swift’s entire catalogue through the same category, prosecutors said.
The department said the scheme diverted royalty payments
from musicians and songwriters whose music was streamed by genuine listeners.
US attorney Jamie McDonald said Smith exploited AI
technology to defraud streaming platforms and deprive legitimate artistes of
royalty payments.
The case was prosecuted by the complex frauds and cybercrime
unit of the US Attorney’s Office for the Southern District of New York.
The department described the case as its first criminal
prosecution of AI-assisted music streaming fraud.
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