The FBI has announced that they’ve shut down $10m AI streaming fraud run by a North Carolina-based musician who is said to have embezzled over 10 million dollars in streaming royalties. The 52-year-old musician is said to have uploaded hundreds of thousands of AI-generated songs since 2018 to streaming services like Spotify or Apple Music. He supposedly created an elaborate scheme to stream his own songs using bots.
$10m AI Streaming Fraud: What do we know?
This isn’t the first streaming fraud case to be shut down, but it’s one of the first high-profile cases involving AI. The guy from North Carolina is said to have created hundreds of thousands of songs with the help of various AI services since 2017. He published all of these on major music streaming platforms like Spotify and Apple Music over seven years.
The musician set up a system of automated bots that endlessly played his catalog from hundreds of artist profiles. It’s said he created the $10m AI streaming fraud through this method. It’s one of the biggest cases involving AI in the music industry so far.
Collaboration with “AI music company CEO and a music promoter”
Ars Technia is reporting that the musician started out like many others. He published his own original songs in 2017 and then looked for ways to increase his streaming numbers. For this, he’s said to have collaborated with an unnamed “AI music company CEO and a music promoter.”
They first created an automated bot stream that played his songs non-stop. Then in 2018, they also started creating new songs with the help of AI. This is going to be interesting to watch, as it is one of the first cases where an AI music company is involved, and the main charges are not copyright infringement but money laundering.
But the music stopped when the FBI got involved, marking this the first U.S. criminal case concerning generative AI in music. The musician now faces up to 20 years in prison for each charge, including wire fraud and money laundering for the $10m AI streaming fraud.
The future of music AI: Where do we go from here?
This high-profile case of a $10m AI streaming fraud is very likely only the tip of the tip of the iceberg. Here in Germany, streaming manipulation is rampant among many commercial artists in order to reach the top of the charts. While this issue seems to be less publicly discussed in the UK and the US, it would be naive to think that this isn’t happening even with the biggest act.
On the other hand, digital distributors like Distrokid have been increasingly false-flagging many small and independent artists for allegedly using bots to increase their streaming numbers. There have been numerous reports on Reddit and various music forums from confused musicians who have had their entire artist profiles and catalogs removed without any apparent wrongdoing. In many cases, songs of them were added to high-profile playists from third parties, which Spotify had flagged as potentially fraudulent.
With songs being created in the hundreds of thousands per day through generative AI in addition to the already 120,000 daily songs being published on Spotify and the other DSPs, this might get worse before it gets better.
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