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Michael Smith, a 54-year-old North Carolina musician, was sentenced to 18 months in prison after pleading guilty to conspiracy to commit wire fraud. The Justice Department said he used as many as 10,000 fraudulent accounts to stream AI-generated songs and must forfeit $8 million in royalties.
Michael Smith, a 54-year-old musician from North Carolina, has been sentenced to 18 months in prison for a scheme that used automated accounts to generate streams of songs he owned, the US Justice Department said. Smith must also forfeit $8 million in royalties that prosecutors said he obtained through the fraud.
Smith was sentenced for one count of conspiracy to commit wire fraud, after pleading guilty in court in March, according to the Justice Department announcement as described by The Quietus. The reported scheme ran from 2017 until his arrest in 2024. The source material does not give a precise date for the sentencing beyond saying the department announced it on October 6.
According to the Justice Department, Smith created as many as 10,000 fraudulent accounts and used them to stream music he owned. The songs were largely made with AI, and the department said Smith spread the activity across thousands of tracks to avoid suspiciously high play counts on any one song. His bot accounts streamed hundreds of thousands of songs billions of times, the department said.
The Justice Department cited one example from April 2023: Smith’s accounts using family plans generated 80.9 million streams for his music on YouTube Music that month. For comparison, the department said Taylor Swift’s entire catalogue received 9.3 million streams through family plans on the same service in that month. Those figures are specific to that platform, account type and time period.
How the Scheme Affected Royalties
The case concerns how streaming services calculate royalty payments: automated plays can make a track appear more popular than it is and divert money from the pool paid to rights holders. The Justice Department said Smith’s scheme generated millions of dollars in royalties through streams that did not come from genuine listeners. The court-ordered forfeiture is intended to recover the $8 million in proceeds identified in the case.
The department described the conduct as harming genuine artists and their fans. That is the government’s characterization of the impact; the source material does not provide an estimate of losses to particular artists, platforms or individual listeners. The sentence and forfeiture nonetheless show that manipulating streaming metrics can be treated as wire fraud, not simply as a breach of a platform’s rules.
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A Scheme Running Since 2017
The reported activity began in 2017 and continued until Smith’s arrest in 2024. Rather than concentrate streams on one track, the Justice Department said he distributed automated plays across thousands of songs. The department’s account says this approach was meant to reduce the chance that abnormal activity on a single song would draw attention.
Smith is described in the report as a musician who owned the songs being streamed. The tracks were largely AI-generated, but the legal conviction reported here is for conspiracy to commit wire fraud. The source does not say that using AI to make music was itself the offense; the alleged fraud involved using bots and false accounts to create streams and claim royalties.
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Unanswered Questions About Recovery
The source material does not identify the streaming platforms involved beyond the YouTube Music example, or explain how the $8 million forfeiture will be collected and distributed. It also does not name specific artists who lost royalties or quantify any individual losses. The department’s quoted account says the scheme produced millions in royalties, but the supplied report does not include the court’s detailed calculation of the amount.
The available information also does not describe Smith’s custody arrangements, any additional financial penalties, or whether other people or companies were investigated. Those details should not be inferred from the prison term and forfeiture order alone.
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Serving the Sentence and Forfeiture
Smith is expected to serve the 18-month prison sentence and surrender the $8 million in royalties covered by the forfeiture order. The source material does not state when he must report to prison, set out a payment schedule, or describe any further court proceedings.
Any additional information about recovering the funds or identifying affected rights holders would need to come from court records or a further Justice Department announcement. For now, the confirmed development is the sentence following Smith’s guilty plea and the order to forfeit the royalties attributed to the scheme.
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Key Questions
Who was sentenced in the music-streaming fraud case?
Michael Smith, a 54-year-old musician from North Carolina, was sentenced, according to the Justice Department announcement reported by The Quietus.
What sentence did Smith receive?
Smith received 18 months in prison for conspiracy to commit wire fraud. He had pleaded guilty in March, according to the source report.
How did the streaming scheme work?
The Justice Department said Smith created as many as 10,000 fraudulent accounts to stream songs he owned. It said the music was largely AI-generated and that plays were spread across thousands of songs.
How much money must Smith forfeit?
Smith must forfeit $8 million in royalties described as fraudulently earned through the bot-generated streams.
Was making AI-generated music the crime?
The reported conviction was for conspiracy to commit wire fraud. The supplied information identifies automated streaming and fraudulent accounts as the basis of the scheme; it does not say that making AI-generated music alone was illegal.
Source: hn
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