Nearly Four Years Maximum Prison for AI Music Fraudster Who Siphoned Millions
A North Carolina man employed artificial intelligence to generate thousands of fictitious tracks under fabricated artist names, then deployed hundreds of bot accounts to amplify those streams across major platforms, draining royalty pools that were meant for genuine creators.
In a newly submitted letter to a Manhattan judge—obtained through *Rolling Stone*—U.S. District Court prosecutors have asked for a minimum sentence of forty‑six months imprisonment for Michael Smith, who confessed to operating a multi‑year AI‑driven fraud scheme. His defense advocates for community supervision rather than incarceration, and the Bureau of Prisons has recommended a twenty‑four‑month term. The scheduled sentencing hearing is slated for October 6.
The filing detailed how Smith grew increasingly proficient at inflating play counts on leading services such as Apple Music, Spotify, Amazon Music, and YouTube Music, to the point where his royalty share occasionally surpassed that of prominent established artists. For instance, in April 2023, Taylor Swift’s catalog received 9.3 million streams through YouTube Music’s family‑plan tier, whereas Smith’s synthetic library amassed 80.9 million streams.
Prosecutors alleged that Smith extracted more than eight million dollars in illicit royalties over the course of several years—a blatant, systematic fraud that siphoned revenue originally intended for legitimate songwriters and rightsholders.
Assistant U.S. Attorneys Nicholas W. Chiuchiolo and Kevin B. Mead emphasized in their correspondence that imposing a large prison term would convey that defrauding any federal benefit program—regardless of the offender’s status—must bear serious consequences, warning that a lenient verdict would undermine deterrence against similar crimes.
Michael Smith entered into a plea agreement earlier this year, admitting responsibility for a single count of conspiracy to commit wire fraud—a charge carrying a statutory maximum of five years in custody—and consented to forfeit approximately $8.09 million toward restitution.
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In defense filings last week, Smith and his lawyers said he was “profoundly sorry” for his conduct but that he “did not set out to commit a federal crime.”
“He believed his initial efforts to be lawful,” his lawyers Noell P. Tin and Justine Harris wrote to the judge. “Indeed, Mr. Smith consulted with a well‑known music attorney with extensive experience in legal operations at music publishing companies. Although he ultimately ended up rationalizing conduct that he knew was wrong — false statements to distributors and increasingly deceptive conduct to avoid scrutiny — his conduct began at a time when the legal parameters were unsettled.”
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Prosecutors disputed that in their Tuesday filing, arguing that Smith’s “own words and conduct reveal that he knew from the very beginning that his scheme was a form of fraud.” They said he knowingly carried out the fraud on a daily basis during the six years.
“Michael Smith generated thousands of fake songs using artificial intelligence and then streamed those fake songs billions of times,” U.S. Attorney Jay Clayton said in March. “Although the songs and listeners were fake, the millions of dollars Smith stole was real. 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.”