Federal prosecutors today charged a North Carolina musician who’d taken in around $10 million in royalties from his AI-generated songs that were streamed by the bots he deployed.

Michael Smith, a 52-year-old real musician, had seemingly decided that making a living in the legitimate world of music was a bridge too far. He proceeded to scam platforms such as Spotify, Apple Music and Amazon Music, ultimately resulting in charges of fraud and money laundering conspiracy. He now faces a possible 20-year prison sentence.

Smith created songs using AI, though the software he employed is as yet unknown. He then bought email addresses and created an army of bots, which over seven years listened to his songs billions of times, generating lots of money in royalties.

Smith’s scheme was elaborate, to say the least. Prosecutors say to avoid detection, he would create so many songs that no one track was listened to too many times. His song names and band names mimicked real songs and bands – perhaps indie bands – with titles such as “Zygotic Washstands” and “Zyme Bedewing” and artist names such as “Calvinistic Dust” and “Callous Post.”

Investigators say Smith had tried to make a living streaming his own music on various platforms but had failed to generate much revenue. In 2018, after a failed enterprise collaborating with other real musicians to stream their music, Smith approached an AI music outfit and together they created a large library of songs. Smith then deployed his bots to listen to them and the cash quickly started to flood in.

In an email to himself in 2017, Smith calculated his songs were being listened 661,440 times daily across various platforms, potentially earning more than $3,000 a day and up to $1.2 million per year. By the middle of 2019, his monthly earnings reached $110,000, revenue that was shared with his co-conspirators. The New York Times said Smith calculated in 2024 that his AI tunes had been streamed around 4 billion times since 2019, providing about $12 million in royalties.

“Through his brazen fraud scheme, Smith stole millions in royalties that should have been paid to musicians, songwriters and other rights holders whose songs were legitimately streamed,” said U.S. Attorney Damian Williams.

Smith’s scheme, as elaborate as it was, did generate some scrutiny within the streaming business. In 2018, he was approached by a distribution company about possible “streaming abuse,” to which he reportedly said there was “absolutely no fraud going on whatsoever.”

Photo: Unsplash