Man Pleads Guilty to Using AI to Generate $8 Million in Fraudulent Streaming Music Royalties
Michael Smith of North Carolina pleaded guilty to conspiracy to commit wire fraud after using artificial intelligence and automated bots to generate thousands of fake songs and billions of fraudulent streams, collecting over $8 million in music streaming royalties. Smith created hundreds of thousands of AI-generated tracks and thousands of streaming accounts to spread fake plays across his catalog, evading detection by streaming platforms like Spotify and Apple Music. This scheme exploited royalty payment models based on play counts, diverting revenue from legitimate artists and rights holders. Smith agreed to forfeit the illicit earnings and faces up to five years in prison when sentenced on July 29. The case highlights rising concerns over AI-generated music, copyright, and fraud within digital music platforms, as well as the challenges these technologies pose for preventing abuse. Smith was previously released on a $500,000 bond after his initial charges in September 2024.
