A 52-year-old named Michael Smith has pleaded guilty after admitting he used more than a thousand automated accounts to inflate plays of AI-generated music and collect the resulting royalties. Prosecutors say the scheme ran from 2017 to 2024 and targeted major streaming services.

What prosecutors say happened

According to the Department of Justice, Smith worked with others to produce hundreds of thousands of songs using artificial intelligence. Instead of promoting those songs to real listeners, he ran them through a network of bots to generate streams on platforms such as Spotify, Amazon Music, Apple Music, and YouTube.

US Attorney Jay Clayton summarized the scheme this way: "Michael Smith generated thousands of fake songs using artificial intelligence and then streamed those fake songs billions of times."

How the bot network was set up

  • Smith used 52 cloud service accounts, each running 20 bots, for a total of 1,040 bots.
  • Those bots were configured to stream multiple tracks per day. By Smith's own calculations the system could stream up to 636 different songs per day, producing about 661,440 streams daily.
  • Rather than concentrating on a few tracks, the scheme spread plays across many AI-created songs to make detection harder.

The math prosecutors included

Streaming royalties vary by platform, but a commonly cited range is about $0.003 to $0.005 per stream. Smith reportedly used a figure of half a cent per stream when estimating revenue. Using that number, his operation could produce roughly $3,307 per day or about $1.2 million per year.

Legal outcome and penalties

Smith pleaded guilty to one count of conspiracy to commit wire fraud on March 19, 2026. The Department of Justice reports he obtained more than $8 million in royalties through this activity. He has agreed to forfeit $8,091,843.64.

Sentencing is scheduled for July 29, 2026. Smith faces a maximum prison term of five years.

Clayton noted the practical harm from the scheme: "Although the songs and listeners were fake, the millions of dollars Smith stole was real." Prosecutors say those funds were diverted away from legitimate artists and rights holders.

Why this matters

This case highlights several growing issues in music streaming: the rise of AI-generated content, the potential for automated manipulation of plays, and the challenge platforms face in distinguishing legitimate activity from fraud. Streaming royalty systems are designed to reward actual listeners and creators, but automated schemes like this can undermine that model and harm real people who rely on those payments.

The case also shows that large-scale, automated fraud schemes can produce substantial sums, and that law enforcement is pursuing such abuses of the digital ecosystem.