US Man Charged for Using AI to Defraud Streaming Service of $10M

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A man named Michael Smith has been indicted by the U.S. Department of Justice for allegedly defrauding major streaming platforms, including Amazon Music, Apple Music, Spotify, and YouTube Music, out of approximately $10 million in royalties. The indictment details claims that Smith employed AI technology and bots to manipulate the system and generate income illicitly.

According to reports, streaming services pay a portion of their royalties to creators based on song play counts. Smith reportedly exploited this mechanism by programming bots to continuously play his music across various streaming platforms. Estimates suggest that these bots played his songs an astonishing 661,000 times daily, potentially generating around $1.2 million in royalty income each year.

After 2018, Smith partnered with an AI music company to significantly increase his music production, creating hundreds of thousands of tracks through automated scripts. Each song was given a unique title, and Smith fabricated different artists’ names to further deceive the platforms.

The charges against Smith include wire fraud and conspiracy to launder money, with potential penalties of over 20 years in prison if convicted. This case highlights the growing concerns surrounding the use of technology in the music industry and the challenges in regulating digital content.

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