A North Carolina man was sentenced to 18 months in prison for using artificial intelligence to defraud music streaming platforms and musicians of millions of dollars in royalty payments.
The man, Michael Smith, 54, who is from Cornelius, N.C., north of Charlotte, was also sentenced to two years of supervised release and ordered to forfeit more than $8 million in royalties, the U.S. attorney’s office for the Southern District of New York said in a news release on Tuesday.
The case against Mr. Smith was the Justice Department’s first involving fraud through A.I.-assisted music streaming. Mr. Smith was charged in 2024, and in March, he pleaded guilty to one count of conspiracy to commit wire fraud, which carries a maximum sentence of five years in prison.
Lawyers representing Mr. Smith did not immediately respond to a request for comment on Wednesday.
“By flooding music streaming platforms with automated bots in the place of consumers, and fake songs in the place of creativity, Smith robbed millions in royalty payments from genuine artists and their fans,” Jamie McDonald, the U.S. attorney for the Southern District of New York, said in the news release.
According to prosecutors, Mr. Smith’s scheme began in 2017, when he created thousands of bot accounts on streaming platforms by using email addresses he had purchased online. He used A.I. to create music, as well as software to stream that music on loops from different computers. The result was the appearance of individual listeners tuning into his music from various places.
Mr. Smith’s A.I.-generated artists had names like “Callous Post” and “Calorie Screams,” and they produced songs such as “Zygotic Washstands” and “Zymotechnical.” Those and other songs were top performers on platforms like Amazon Music, Apple Music and Spotify.
The A.I.-generated music that Mr. Smith owned was streamed by his bot accounts billions of times through 2024, the Justice Department said, and at times Mr. Smith was using as many as 10,000 bot accounts at once to stream the music.
By way of comparison, the Justice Department said that in April 2023, Taylor Swift’s entire catalog received 9.3 million streams on YouTube Music from family plan streams. That same month, according to the department, Mr. Smith’s bot accounts used family plans to stream his music more than 80 million times.
A financial breakdown that Mr. Smith emailed himself in 2017 presented a clearer picture of what he stood to gain. He calculated that he could stream his songs 661,440 times each day, which he estimated could bring in daily royalty payments of $3,307.20, and as much as $1.2 million in one year.
By June 2019, Mr. Smith was earning about $110,000 each month from royalties, with a portion going to co-conspirators, according to the indictment. In 2024, he bragged in an email that he had reached four billion streams and $12 million in royalties since 2019.
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