Gate News: On March 19, the U.S. Southern District of New York federal prosecutors announced on March 20 that Michael Smith, a resident of Concord, North Carolina, has pleaded guilty to streaming royalty fraud. According to the indictment and court statements, Michael Smith used AI technology to generate hundreds of thousands of songs in bulk and employed automated “bot accounts” to carry out billions of fake plays, simulating real user listening behavior. The platforms involved include major streaming services such as Amazon Music, Apple Music, Spotify, and YouTube Music. Since these platforms distribute royalties to rights holders based on play counts, large-scale fake traffic shifts legitimate creator royalties to the fraudsters. To evade platform detection of abnormal traffic, Smith distributed bot plays across thousands of songs, deliberately lowering the peak play count for individual tracks. Through these methods, he fraudulently obtained over $8.09 million in royalties. Smith pleaded guilty to “conspiracy to commit telecommunications fraud” and agreed to forfeit $8,091,843.64. The maximum sentence for this charge is five years in prison, with a formal sentencing scheduled for July 29, 2026.
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