The post North Carolina Musician Charged with Fraud After AI-Generated Songs Inflate Streaming Royalties on Major Platforms appeared on BitcoinEthereumNews.com.

A musician from Cornelius, North Carolina, has been implicated in a sophisticated fraud operation involving music streaming platforms. This multi-million dollar scam, spanning from 2017 to 2024, raised serious questions about the legality and ethics surrounding AI-generated content. U.S. Attorney Damian Williams emphasized the severity of the case, highlighting Smith’s fraudulent activities that undermined the integrity of the music industry. This article explores a major fraud case involving the exploitation of AI in music streaming, spotlighting the legal ramifications and implications for the music industry. Fraudulent Streaming Scheme Unveiled Michael Smith, a 52-year-old musician, has been charged with multiple criminal offenses, including wire fraud and money laundering, linked to a prolific scheme that manipulated music streaming metrics to generate over $10 million in royalties. Allegedly, Smith used artificial intelligence technology combined with automated bots to simulate billions of streams across various platforms like Spotify, Apple Music, and YouTube Music, thereby unlawfully enriching himself at the expense of legitimate artists and rights holders. The Mechanics of the Scam According to the indictment, Smith’s operation was intricately designed to circumvent the royalty payment structure inherent to streaming services. By publishing an extensive catalog of AI-generated tracks, he utilized a network of fake accounts to perpetrate his fraud. This led to an average of 661,440 streams per day, yielding an estimated annual royalty income of approximately $1.2 million. The indictment noted, “Smith allegedly expressed the need for a rapid influx of songs to outsmart the anti-fraud measures implemented by streaming platforms.” AI in Music: A Double-Edged Sword The case raises important questions about the intersection of AI technology and intellectual property in the music industry. While Smith’s use of AI for generating music is not illegal per se, the manner in which it was applied as a means to orchestrate a fraud is…

---

Filed under: News - @ September 6, 2024 12:25 am