**Michael Smith**, a 54-year-old musician, admitted to purchasing hundreds of thousands of AI-generated songs from an accomplice. He then uploaded these tracks to various streaming platforms and deployed AI bots to generate billions of artificial streams. This elaborate scheme allowed him to fraudulently collect royalty payments. ### The Modus Operandi According to court documents unsealed in September 2024, Smith collaborated with an unnamed music promoter and the CEO of an AI music company between 2017 and 2024. To evade detection by anti-fraud systems, the bots accessed the streaming platforms through Virtual Private Networks (**VPN**s). In an email dated October 4, 2018, Smith instructed his co-conspirators to flood the platforms with "a TON of content with small amounts of Streams" to circumvent anti-fraud policies. ### Scale of the Operation At its peak, Smith utilized over 1,000 bot accounts to inflate stream counts. A financial breakdown from October 20, 2017, revealed that he managed 52 cloud service accounts, each hosting 20 bot accounts. Smith estimated that each bot could stream approximately 636 songs daily, totaling around 661,440 streams per day. With an average royalty rate of half a cent per stream, this translated to daily earnings of $3,307.20, monthly earnings of $99,216, and annual earnings exceeding $1.2 million. ### Official Statements "**Michael Smith** generated thousands of fake songs using artificial intelligence and then streamed those fake songs billions of times. Although the songs and listeners were fake, the millions of dollars **Smith** stole was real," stated U.S. Attorney **Jay Clayton**. "Millions of dollars in royalties that **Smith** diverted from real, deserving artists and rights holders. **Smith's** brazen scheme is over, as he stands convicted of a federal crime for his AI-assisted fraud." Prosecutors highlighted that **Smith** fraudulently collected over $10 million in royalty payments by having his bots stream hundreds of thousands of AI-generated songs billions of times. In a February 2024 email, he boasted that the songs generated "over 4 billion streams and $12 million in royalties since 2019." ### Consequences **Smith** has agreed to forfeit $8,091,843.64 and faces a maximum sentence of 5 years in prison after pleading guilty to one count of conspiracy to commit wire fraud. <div><p><a rel="noopener sponsored" href="https://hubs.li/Q043YRMg0"><img alt="tines" src="https://www.bleepstatic.com/c/p/red-report.jpg"></a></p><div> <h2><a rel="noopener sponsored" href="https://hubs.li/Q043YRMg0">Red Report 2026: Why Ransomware Encryption Dropped 38%</a></h2> <p>Malware is getting smarter. The Red Report 2026 reveals how new threats use math to detect sandboxes and hide in plain sight.</p> <p>Download our analysis of 1.1 million malicious samples to uncover the top 10 techniques and see if your security stack is blinded.</p> </div></div>