Musician Pleads Guilty to $10M AI-Driven Streaming Fraud

Michael Smith, a 54-year-old musician from North Carolina, has pleaded guilty to a federal charge of conspiracy to commit wire fraud, admitting to a scheme that generated over $10 million in royalty payments through fraudulent streaming of AI-generated songs. Between 2017 and 2024, Smith used AI to create hundreds of thousands of songs, which were then streamed billions of times using automated bots. He collaborated with a music promoter and the CEO of an AI music company to inflate streaming statistics and evade detection by using VPNs. Smith's operation peaked with over 1,000 bot accounts, leading to daily earnings exceeding $3,300. He has agreed to forfeit over $8 million and faces a maximum prison sentence of five years. U.S. Attorney Jay Clayton emphasized the impact on legitimate artists and rights holders, highlighting the serious nature of Smith's fraudulent activities.

Key Points: • Michael Smith admitted to collecting over $10 million through AI-generated song streaming fraud. • The scheme involved using over 1,000 bots to artificially inflate streaming numbers on major platforms. • Smith faces a maximum of five years in prison and has agreed to forfeit $8,091,843.64.