A man in the United States used AI to create a song, scamming over $8 million in royalties

BlockBeats News, March 20th, the Southern District of New York federal prosecutor announced today that Michael Smith, a resident of Cornelius, North Carolina, has formally pleaded guilty to his involvement in a streaming royalty fraud scheme. According to the indictment and court statements, Michael Smith used AI to batch generate hundreds of thousands of songs and, with the help of an automated "botnet," artificially streamed these songs billions of times to simulate real user listening behavior. The affected streaming platforms include mainstream platforms such as Amazon Music, Apple Music, Spotify, and YouTube Music.

Since platform royalties are distributed to rights holders from a public royalty pool based on the streaming ratio, large-scale fraudulent traffic has redirected legitimate creators' royalty income to the fraudster. To evade platform anomaly detection, Smith dispersed botnet streams across thousands of songs, intentionally suppressing individual song play peaks. Through these means, he fraudulently obtained over $8.09 million in royalties.

Smith has pleaded guilty in court to the charge of "conspiracy to commit wire fraud" and has agreed to forfeit $8,091,843.64. This charge carries a maximum sentence of five years' imprisonment, and the formal sentencing will take place on July 29, 2026.