Michael Smith, a 54-year-old from Cornelius, North Carolina, was sentenced Oct. 6 to 18 months in prison for a scheme that prosecutors said used artificial intelligence-generated music and automated streaming accounts to fraudulently claim royalties. The U.S. Attorney’s Office for the Southern District of New York said Smith pleaded guilty in March to one count of conspiracy to commit wire fraud.
Prosecutors said the scheme operated from 2017 to 2024 and involved fake accounts on Amazon Music, Apple Music, Spotify and YouTube Music. Automated software repeatedly streamed songs Smith owned, many of them created with AI, generating royalty payments for plays that did not come from genuine listeners.
According to prosecutors, the operation at times ran as many as 10,000 bot accounts at once. The streams were distributed across thousands of tracks to evade platforms’ anti-fraud systems. Authorities said the scheme generated more than $8 million in fraudulent royalties.
The sentence also includes two years of supervised release. Smith was ordered to forfeit $8,091,843.64, according to the U.S. Attorney’s Office.
Prosecutors described the case as the Justice Department’s first criminal prosecution involving AI-assisted music streaming fraud. The source report said Smith’s attorneys could not immediately be reached for comment.
