Federal prosecutors first charged North Carolina musician Michael Smith in September 2024, alleging that he used bots to generate billions of streams of AI-generated songs and collect royalties. The U.S. Attorney’s Office for the Southern District of New York called it the first criminal case involving artificially inflated music streaming. The case later advanced: Smith pleaded guilty to conspiracy to commit wire fraud in March 2026 and was sentenced on October 6, 2026, to 18 months in prison.
What was Michael Smith accused of doing?
The September 4, 2024 indictment alleged that Smith ran a music-streaming fraud scheme from approximately 2017 through 2024. Prosecutors said he used automated accounts to stream AI-generated songs he owned billions of times on services including Amazon Music, Apple Music, Spotify and YouTube Music. The indictment described those streams as a way to make automated activity appear to be genuine listening and obtain royalty payments. These were allegations at the time of filing; Smith later pleaded guilty to conspiracy to commit wire fraud.
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The case was described by the Southern District of New York as the first criminal prosecution involving artificially inflated music streams. The 2024 announcement set out the indictment and its allegations.
How did the streaming fraud allegedly work?
According to the government’s account at sentencing, Smith used software to stream songs he owned continuously through thousands of fraudulent accounts. He spread automated activity across thousands of tracks rather than concentrating it on a small number of songs, and at times used as many as 10,000 bot accounts simultaneously. Prosecutors also said he used fake email accounts and fraudulently obtained debit cards to create streaming accounts.
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The point was to generate streams that could be counted toward royalties while obscuring the artificial pattern. The 2024 indictment gives the charging document’s detailed allegations; the later account appears in the government’s sentencing announcement.
Why did fake streams matter to other musicians?
The government described streaming royalties as being paid proportionately from a pool. In that model, streams credited to Smith’s music could divert royalty payments from musicians, songwriters and other rights holders whose music listeners actually chose to play. The harm alleged was therefore not only that the streams and listeners were fake, but that royalty money was obtained through the fabricated activity.
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How much money was involved?
The figures changed as the case moved through the justice system. They refer to different stages and measures, so the indictment-era allegation should not be treated as the same figure as the later forfeiture order.
| Stage | Figure | What it refers to |
|---|---|---|
| September 2024 indictment | More than $10 million | Royalties prosecutors alleged Smith obtained, according to the 2024 indictment announcement. |
| March 2026 guilty plea | More than $8 million | Royalties reported in the government’s plea announcement; it also reported forfeiture of $8,091,843.64. See the March 2026 announcement. |
| October 2026 sentence | $8,091,843.64 | Forfeiture ordered by the court, as reported by the government in its sentencing announcement. |
What happened after the indictment?
Smith pleaded guilty to conspiracy to commit wire fraud on March 19, 2026. That plea changed the case from a set of indictment allegations to a conviction on the conspiracy charge. On October 6, 2026, the court sentenced him to 18 months in prison, followed by two years of supervised release, and ordered forfeiture of $8,091,843.64.
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What was the scale of the streaming activity?
To illustrate the scale, the government said that in April 2023 Smith’s music received 80.9 million fraudulent YouTube Music family-plan streams, while Taylor Swift’s entire YouTube Music catalogue received 9.3 million streams from family-plan users that month. This comparison is specifically about YouTube Music family-plan streams in that month, as reported in the October 2026 sentencing announcement; it is not a comparison of all streams across platforms.
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