Tonight, in “Damn, those folks at the Crime Factory sure do love to whip up something new, huh?” news: A North Carolina man has just become the first person in the United States to plead guilty to a federal charge of streaming music fraud. The man in question, Mike Smith, has been ordered to give back the $8 million he made using AI to first make, and then stream, “hundreds of thousands” of songs upwards of a billion times on services like Spotify, Apple Music, and Amazon Music, and faces a maximum sentence of five years in prison.
Technically—per a Department Of Justice posting about the plea—Smith has pled guilty to conspiracy to commit wire fraud, although he was pretty clearly putting those wires to some fairly inventive uses. We actually reported on Smith’s arrest way back in 2024; at the time, he was caught (per The New York Times) claiming to have bilked at least $12 million out of various services’ royalties systems, although the DOJ posting uses the “more than $8 million” amount today, including when it listed the court-ordered forfeiture. ($8,091,843.64, if you want to be precise.) According to federal investigators, Smith ended up using AI on both sides of his little self-created musical ecosystem: Because streamers like Apple Music and Spotify flag (and penalize, including with potential fees) songs that get anomalous listening activity, Smith was forced to generate thousands upon thousands of songs for his other bots to then listen to, the better to launder his fraud across vast swathes of tracks with unrelated, technically-a-word names like “Zymotechnical” and “Rectosigmoid.”
(If you’re curious about Smith, Wired did a fairly in-depth piece on him last year; he is, fascinatingly, not a complete nobody in the world of music, having worked on projects with RZA and Snoop Dogg, and even appeared as a judge on a single season of a BET reality competition series called One Shot. He just also was doing this other thing, where he worked with an AI firm to gin up huge numbers of songs, and then automated streams of them, to the tune of $8 million fraudulent bucks.)
The 52-year-old Smith’s plea comes in the same week that the music industry raised new worries about AI-generated tracks; the IFPI put out its latest Global Music Report on Wednesday, prompting claims from Sony that it’s had to blast 135,000 deepfakes of songs by its artists from various streamers. (To be fair, that’s not what Smith appears to have been up to; he was crapping out thousands of generic electronica songs, not trying to peddle knock-off Beyoncés.) Industry groups are continuing to call for more protections against both sides of the AI streaming equation—although it’s not clear yet how sophisticated the tools to block this sort of thing actually are at the moment.
Keep scrolling for more great stories.