NEW YORK, NY – Michael Smith, 32, has been charged in a wide-ranging fraud scheme involving the creation of hundreds of thousands of AI-generated songs and their manipulation on streaming platforms to illicitly collect more than $10 million in royalties. The U.S. Attorney’s Office for the Southern District of New York announced Smith’s arrest today, following the unsealing of a three-count indictment for conspiracy to commit computer fraud, money laundering, and defrauding music platforms.
According to the indictment, Smith utilized artificial intelligence to generate hundreds of thousands of songs and employed automated bots to stream these songs billions of times across platforms like Spotify, Apple Music, and YouTube Music. This fraudulent activity diverted royalty payments away from legitimate artists and songwriters. Smith allegedly created thousands of fake accounts to stream the AI-generated tracks, manipulating the system to amass substantial royalty payouts without raising suspicion.
U.S. Attorney Damian Williams remarked, “Smith’s scheme defrauded the music industry by using artificial intelligence and automation to generate millions in illicit royalties. Today’s charges demonstrate that those who undermine the integrity of the creative industry will face consequences.”
FBI Acting Assistant Director Christie M. Curtis stated, “Smith’s exploitation of technology to profit through deception highlights the growing threat of fraud in the digital era. The FBI remains committed to combating such schemes that target legitimate artists and businesses.”
Smith’s arrest occurred in North Carolina, where he will appear before a U.S. Magistrate Judge. If convicted, he faces substantial prison time, forfeiture of profits, and restitution to victims of the scheme.