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Feds Score Guilty Plea in First-Ever U.S. Streaming Fraud Case — An $8M Scheme Aided by AI Music
Michael Smith admitted to using bots and AI-generated songs to claim over $8 million in royalties, exploiting fixed payout pools and evading streaming platform fraud detection.
- On Thursday, 54-year-old North Carolina musician Michael Smith pleaded guilty to wire fraud conspiracy, marking the first criminal streaming fraud case brought by U.S. prosecutors.
- To execute the scheme, Smith deployed over 1,000 automated bot accounts to continuously stream AI-generated tracks across Spotify, Apple Music, Amazon Music, and YouTube Music.
- The operation collected more than $8 million in royalties before the Mechanical Licensing Collective identified the fraud, preventing further diversion of royalties from legitimate artists.
- Smith agreed to forfeit his proceeds and faces up to five years in prison, with sentencing scheduled for July 29, 2026, before District Judge John Koeltl.
- The Mechanical Licensing Collective stated the case highlights the "serious threat that streaming fraud poses to the music industry" and emphasized ongoing protection efforts for songwriter royalties.
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North Carolina Man Must Pay Back the Millions He Acquired in First-Ever Streaming Fraud Case
Michael Smith, 54, was found guilty on March 19, 2026, in the first-ever federal criminal case of streaming fraud in the U.S. He agreed to forfeit more than $8 million in assets, the amount he managed to scam from streaming platforms. A sentencing is scheduled for July 29. Smith pleaded guilty to one count of conspiracy to commit wire fraud, per a statement from the U.S. Attorney’s Office of the Southern District of New York. The maximum sentenc…
·New York, United States
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Coverage Details
Total News Sources24
Leaning Left2Leaning Right3Center3Last UpdatedBias Distribution38% Center, 37% Right
Bias Distribution
- 38% of the sources are Center, 37% of the sources lean Right
38% Center
L 25%
C 38%
R 37%
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