A 54 year old man in the United States has been sentenced to 18 months in prison for using artificial intelligence generated music and automated streaming accounts to fraudulently collect more than $8 million in royalties from music platforms.
Michael Smith, from Cornelius, North Carolina, was sentenced on October 6 after admitting to conspiracy to commit wire fraud. He was also ordered to pay $8.09 million in forfeiture and will serve two years of supervised release after his prison term.
The case highlights how artificial intelligence can be exploited to manipulate digital music services and divert royalty payments from legitimate musicians and songwriters. Brandspur Brand News reports that the United States Department of Justice described the prosecution as its first criminal case involving music streaming fraud assisted by what it called super intelligence technology.
Court documents showed that Smith’s scheme ran from 2017 to 2024. He allegedly created thousands of fake accounts on platforms including Spotify, Apple Music, Amazon Music and YouTube Music, then used software to make those accounts repeatedly stream music he controlled.
To sustain the operation, Smith relied on hundreds of thousands of songs generated using artificial intelligence. He also used fake email addresses and fraudulently obtained debit cards to establish streaming accounts, while spreading the activity across a large catalogue to reduce the likelihood of detection.
The automated accounts generated billions of streams, allowing Smith to collect royalties despite the absence of genuine listeners behind the activity. Streaming platforms distribute royalty payments among eligible songwriters, performers and other rights holders, meaning fraudulent plays can divert money from legitimate music creators.
The scale of the operation was illustrated by figures from April 2023. During that month, Taylor Swift’s entire catalogue received 9.3 million streams on YouTube Music through family plans, while Smith’s automated accounts generated 80.9 million fraudulent streams of his AI generated music through similar plans.
Investigators said Smith obtained more than $8 million through the scheme. The fraud ended in a guilty plea on March 19, 2026, before US District Judge John G. Koeltl, who imposed the sentence.
The prosecution was handled by the Complex Frauds and Cybercrime Unit of the US Attorney’s Office for the Southern District of New York, with the Federal Bureau of Investigation assisting the investigation.
The case underscores a growing challenge for digital music businesses: distinguishing genuine audience engagement from artificial activity designed to exploit payment systems. For musicians who depend on streaming royalties, manipulated plays can mean money being distributed to fraudsters instead of those whose work attracts real listeners.
