A North Carolina man used artificial intelligence to create thousands of fake songs by fake bands, then put them on streaming services where they were enjoyed by audiences of fake listeners, prosecutors said.
Penny by penny, he collected a very real $10 million, they said, when they accused him of fraud.
The man, Michael Smith, 52, was accused in a federal indictment unsealed Wednesday of stealing royalty payments from digital streaming platforms for seven years. Mr Smith, a flesh-and-blood musician, produced AI-generated music and played it billions of times using bots he programmed, according to the indictment.
Alleged artist names such as “Callous Post”, “Calory Screams” and “Calvinistic Dust” produced tunes such as “Zygotic Washstands”, “Zymotechnical” and “Zygophyllum” which were top performers on Amazon Music, Apple Music and Spotify. for charges.
“Smith stole millions in royalties that should have been paid to musicians, songwriters and other rights holders whose songs were lawfully streamed,” Damian Williams, the U.S. attorney for the Southern District of New York, said in a statement Wednesday.
Mr. Smith was arrested Wednesday and faces charges including wire fraud and money laundering conspiracy. If convicted, he faces a maximum sentence of 20 years in prison for each charge.
A lawyer for Mr. Smith could not be immediately identified Wednesday. Mr. Smith could not immediately be reached at a number listed under his name in Cornelius, NC, near Charlotte.
His is the first criminal case brought by Mr. Williams’ office involving manipulation of musical streaming. Commercial success in the industry is increasingly measured in digital licenses, which streaming companies offer artists, who increasingly rely on concert appearances to bring in money.
But modern popular music is an overwhelmingly digital affair, with performers using computers to create beeps, bloops and beats — and to iron out the imperfections of their singing voices. Fans no longer have to carry heavy crates of vinyl or finicky cassette tapes, but receive sound in ephemeral files of ones and zeroes.
Prosecutors said Mr. Smith had almost completely cut out the human element.
Their plan involved a circular process, they said. First, Mr. Smith created thousands of fake streaming accounts using email addresses purchased online. He had as many as 10,000, outsourcing the work to paid co-conspirators while creating accounts also became too much work.
He then created software to stream his music on loops from different computers, with individual listeners tuning in from different locations, prosecutors said.
According to a financial breakdown he emailed himself in 2017 — the year prosecutors say he started the scheme — Mr. Smith calculated that he could stream his songs 661,440 times a day. At that rate, he estimated, he could bring in $3,307.20 a year and $1.2 million in daily royalty payments.
To avoid detection by streaming platforms, prosecutors said, Mr. Smith spread his activity across a large number of fake songs, not streaming a single composition multiple times.
Mr. Smith initially uploaded music he had written himself to the platform, but after deciding his catalog was too small to be of any real value, he tried to increase the number of songs he had access to, prosecutors said. First, he used a list of music publicists, and later he tried to sell his services to other musicians, who would pay him to play music or hand over a portion of their royalties when he did. Both plans fell short, prosecutors said.
In 2018, they said, Mr. Smith teamed up with robots.
Joining forces with the chief executive of the AI music company and a music promoter, neither of whom were named in the indictment, Mr Smith created a staggering catalog of bogus songs, uploading thousands to the streaming platform each week.
“Keep in mind what we’re doing here musically,” Mr. Smith wrote in a 2019 email to an AI executive. “This isn’t ‘music’, it’s ‘instant music’ ;).”
These compositions would arrive at Mr. Smith with file names like “n_7a2b2d74-1621- 4385-895d-ble4af78d860.mp3”. Then, he coined plausible names for the songs and their performers: “Zygopteris,” “Zygopteran,” “Zygopterous,” “Zygosporic,” etc.
In a world with real bands named Dirty Projectors, Neutral Milk Hotel and Sun 0))), real albums like “Yankee Hotel Foxtrot” and real songs like “MMMBop”, the titles were no different.
As of June 2019, Mr. Smith was earning about $110,000 a month, part of which went to the co-conspirators, the indictment said. In an email in February of this year, Mr. Smith boasted that he had reached 4 billion streams and $12 million in royalties since 2019.
Mr. Smith, prosecutors said, blatantly lied to music distribution companies. In October 2018, a company informed Mr. Smith that it had received “multiple reports of streaming abuse” and planned to remove his songs from all stores.
Mr. Smith, according to the charges, responded with a strongly worded denial:
“This is absolutely wrong and insane!” he said. “There is absolutely no cheating going on! How can I appeal this?”
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