Michael Smith sentenced to 18 months in prison for AI streaming fraud
US musician Michael Smith was sentenced to 18 months in prison on October 6 by the US Attorney’s Office for the Southern District of New York for orchestrating a streaming fraud scheme using artificial intelligence.
Building a botnet to outstream Taylor Swift
Between 2017 and 2024, the operation scaled dramatically. Smith initially tried to generate payouts using his own catalog, but quickly hit a ceiling due to limited material. To circumvent this, he licensed tracks from other artists and eventually contracted third-party services to supply up to 10,000 AI-generated songs every month, according to reporting by computerbild.de.
To push those tracks up the algorithmic charts, computerbild.de noted that the 54-year-old deployed up to 10,000 automated bot accounts. He funded subscriptions under fictitious names using prepaid debit cards issued to fake profiles, investing over 1.3 million US dollars to sustain the illusion of organic listenership. He utilized not only free accounts to maximize payouts, and engaged a company offering payment services for businesses. In addition, he created artist names and song titles before the music was published on streaming platforms. At its peak in April 2023, Smith’s network drove more than 80 million streams on YouTube Music alone, specifically recording around 80.9 million plays of AI-generated titles according to the prosecutor’s office. For comparison, computerbild.de highlighted that Taylor Swift’s entire catalog drew 9.3 million streams on the same platform during that exact month.
Smith pleaded guilty to wire fraud conspiracy
Faced with charges including wire fraud, wire fraud conspiracy, and money laundering conspiracy, Smith pleaded guilty in March 2024. The case presented challenges for the prosecution, as they were uncertain whether the manipulation of streaming numbers should be handled under criminal or civil law, leading to negotiations where prosecutors dropped two counts and led to a conviction for wire fraud conspiracy, while Smith can still appeal the sentence. Prosecutors emphasized that the scheme siphoned millions in royalties away from human artists and rightful rights holders. Alongside the 18-month prison term, the court ordered Smith to pay back approximately 7.2 million euros (translated to roughly 8.1 million US dollars, as detailed by computerbild.de).
Music industry launched Streaming Integrity Initiative to block fraud
The International Federation of the Phonographic Industry (IFPI) stated that the verdict sends a clear message that streaming manipulation carries severe criminal penalties. However, the organization stressed that prosecution alone remains insufficient. The global music industry is now coordinating through the Streaming Integrity Initiative to actively detect, prevent, and block fraudulent activity, aiming to protect human creators and restore consumer trust across digital platforms.
