A North Carolina resident has been sentenced to 18 months in prison for orchestrating a scheme that used artificial intelligence to generate fake songs and automate billions of fraudulent streams on major music platforms.
Michael Smith, 54, of Cornelius, North Carolina, was also ordered to serve two years of supervised release and forfeit $8,091,843.64 after pleading guilty in March, according to the U.S. Attorney's Office for the Southern District of New York.
The fraud operation ran from 2017 through 2024 and involved thousands of bot accounts on services including Spotify and YouTube Music. Smith created hundreds of thousands of AI-generated tracks and used automated plays to collect royalties while evading detection, at times operating up to 10,000 bot accounts simultaneously using fabricated emails and debit cards.
In one example cited by prosecutors, Smith's bot accounts fraudulently streamed his AI-generated music 80.9 million times on YouTube Music in April 2023 using family plan accounts, generating more than $8 million in fraudulent royalties.
U.S. Attorney Jamie McDonald stated that the case represented the first criminal prosecution involving AI-assisted streaming fraud. Prosecutors said the scheme robbed millions in royalty payments from legitimate artists and their audiences.
