AI Fraudster Bilks Millions from Spotify & Apple

⏱ 2 min read

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A North Carolina man, Michael Smith, just admitted in federal court to a brazen scheme that ripped off music streaming services and real artists. Smith used artificial intelligence to churn out hundreds of thousands of bogus songs, then flooded platforms like Spotify, Apple Music, and YouTube Music with fake streams using automated programs – so-called ‘bots’.

Prosecutors say Smith’s goal was simple: collect the royalty payments meant for actual musicians. Billions of fraudulent streams later, he’d diverted “millions of dollars” from legitimate artists and rights holders, according to U.S. Attorney for the Southern District of New York, Jay Clayton.

Smith pleaded guilty to conspiracy to commit wire fraud before Judge John G. Koeltl. The scam worked by creating a massive network of ‘Bot Accounts’ on the streaming services. These accounts were then programmed to endlessly play the AI-generated tracks, making it *look* like genuine listener activity. The more streams, the more money Smith raked in – money that should have gone to artists earning royalties through honest work.

The feds say this isn’t just about inflated numbers; it’s about real cash stolen from musicians who depend on streaming revenue. This case highlights a new frontier of digital fraud where AI is being weaponized for financial gain, and legitimate creators are left to foot the bill.