Michael Smith jailed 18 months for $8M AI streaming scam

A federal judge in Manhattan sentenced Michael Smith, 54, of Cornelius, North Carolina, to 18 months in prison on October 6 for running a seven-year scheme that used roughly 10,000 bots and hundreds of thousands of AI-generated songs to collect more than $8 million in streaming royalties, as Ars Technica reported.

The arithmetic is the part that lingers. In April 2023, Smith's bot accounts generated 80.9 million YouTube Music family-plan streams for his AI catalog, while Taylor Swift's entire catalog pulled 9.3 million streams in the same category that same month.

U.S. District Judge John G. Koeltl handed down the sentence and ordered Smith to forfeit $8,091,843.64, following Smith's March 19, 2026 guilty plea to one count of conspiracy to commit wire fraud. Prosecutors had asked for at least 46 months, the low end of the 46-to-57-month federal guidelines range; the U.S. Probation Office recommended 24 months; Smith's lawyers asked for probation. Koeltl said "the guideline range is somewhat inflated," noting the offense was non-violent and not drug related.

Between 2017 and 2024, Smith created thousands of fake streaming accounts on Spotify, Apple Music, Amazon Music, and YouTube Music, loaded them with hundreds of thousands of AI-generated tracks, and ran the bots continuously, according to Forbes. The Justice Department described the prosecution as its first criminally charged AI-assisted music streaming fraud case.