What I don’t understand. Why are the platforms not just splitting each payers monthly subscription with all the songs they have played that month. If I only play one song - it’s 12.99 for Rick Astley. Or if someone plays music 24/7 their streams are worth much less. That seems like a much fairer system that is impossible to abuse. For ad supported users you can still defraud the advertisers of course
I am not sure I understand. Surely a AI generated song isn't a "fake song"? Is it a crime to publish an AI generated song?
It seems that what he is guilty of is to generate some fake users pretending to listen to his songs, is that right? I can see how it is fraud, but how is it different from all the dark patterns used by newspapers to generate more page prints (like auto-refreshing pages)?
I agree thats more appropriate. There is nothing AI here, its just simple automation. Couple things that are probably applicable in this case or cases like this where royalties are earned based on assumed advertising traffic
1. There is no way he the the only one or first one. Chances are that more than likely he was subscribing to some third party services which were offering this feature.
2. He probably took it too far to get noticed and get in limelight
When you deliberately violate a TOS using deception in order to get money or property from a service, you're committing fraud.
There are plenty of ways to violate a TOS non-remuneratively or without using deception ("deception" is an element of the crime of fraud and has to be proved up in court; it's not simply what the TOS says it is). Those are civil matters, not crime.
The template you want to be working from: lying for money is fraud.
It wasn’t giving Spotify similar profit, though. Their subscription pricing assumes both a) ads and b) that on average listeners won’t listen more than a certain amount, and will listen relatively broadly such that a single artist isn’t disproportionately rewarded (and thus lots of different artists find it lucrative to be on the platform, increasing its appeal).
In short, this isn’t a “cool infinite money hack” whereby you can pay a subscription fee and make it back with dividends as an artist. Instead, it’s https://xkcd.com/1494/
It's not. And a lot of this fraud was done with non-AI songs. But it helps show his attitude.
> It seems that what he is guilty of is to generate some fake users pretending to listen to his songs, is that right? I can see how it is fraud, but how is it different from all the dark patterns used by newspapers to generate more page prints (like auto-refreshing pages)?
Does that get them more money just for showing the ads? Usually the number of page views is up to you. If you find a way to make oodles of money off a mechanism like that, it very well might be criminal fraud!
If he used bots to stream his own song 80 million times then folks at the streaming services would notice. Instead he spread the 80 million fraudulent streams over tens of thousands of machine generated songs.
From what I've read they weren't AI generated songs of the kind that come to mind when most of us think of AI generated songs.
They were just simple short instrument loops (a basic drum machine beat, a short bass line, a few piano notes) repeating indefinitely, white noise, drones, and such.
This actually doesn’t have anything to do with AI, especially since the scheme started in 2017.
The fraud is only possible because of the way the streaming revenue sharing is split. The way royalties are paid by streamers can basically be summed up by the equation: (total subscription revenue * some agreed to percentage) / total hours streamed by all subscribers for all songs * total hours your songs were streamed.
So let’s say total revenue is $1 million and the artists get 10% of revenue, and there is a total of 1 million hours of streamed music by those subscribers. This means that artists will earn 10 cents for every hour their song is streamed.
On the surface, this seems like a pretty fair way to distribute revenue.
However, what this means that a user who streams more will generate more revenue for artists than a user who streams less, even though the two users pay the same price for their subscription.
For example, imagine a streamer only has two customers, Bob and Alice. If Bob listens to 99 hours of Artist A, while Alice listens to 1 hour of Artist B, then Artist A will get 99 times as much revenue as Artist B, even though they both have one fan and they both pay the same.
So you can see how this could be abused; if I sign up for an account and have it stream my music 24 hours a day, 7 days a week, I am going to have more hours streamed than 20 average users, meaning I end up earning more revenue in royalties than I paid for my subscription (since even though I only get 10% of the revenue, my 20x the average subscriber volume means I end up with 2x my subscription cost in revenue)
If I do this thousands of times, I can make serious money… like this guy did, apparently.
There is a simple fix for this, and I think it actually makes it more fair for artists; do the revenue split on a per user basis. In other words, if 10% of revenue goes to the artists, you take 10% of an individual subscribers subscription price, and divide it up amongst all the artists that user streamed based on time streamed. For example, if my sub costs $10, $1 goes to the artists I stream. If I only listen to one artist, they get the $1 no matter how many hours I stream.
This ensures that a single user can never direct more than their own 10% to an artist, and you would have no incentive to stream your own music.
> There is a simple fix for this, and I think it actually makes it more fair for artists; do the revenue split on a per user basis. In other words, if 10% of revenue goes to the artists, you take 10% of an individual subscribers subscription price, and divide it up amongst all the artists that user streamed based on time streamed. For example, if my sub costs $10, $1 goes to the artists I stream. If I only listen to one artist, they get the $1 no matter how many hours I stream.
It's much fairer which unfortunately pisses off the Big 3 major publishers, and they've blocked any attempt by streamers to use this model.
I believe Spotify briefly attempted it in the late 2010s before having to shutdown a similar revenue-sharing system as the one you described from pressure by the major labels.
> I don't understand why a label wouldn't like this model...
It’s pretty obvious, isn’t it? They’d make less money and
they have a lot of leverage over Spotify to force it to accept pretty much whatever terms that benefits the big labels at the expense of indies.
Interestingly this gives rise to a business opportunity for indies. Create an indie-only music service that doesn't include the big labels, and encourage indie lovers to use it on the basis that artists get more of their money that way. They should still be able to manage viable margins since they don't have to sink disprortionate royalties to the big labels.
They make less money, the size of the pot used to disburse royalties to them becomes capped at the max amount paid by subscribers listening to their artists instead of the whole revenue coming from subscriptions.
I don't get your reasoning but I also don't think your conclusion holds.
A simple solution is just a saner redistribution of the money paid by users according to their listening habits. Isn't that what you've proposed?
Assume that currently:
Alice listens 1 hour/month to Ed Sheeran
Bob listens 730 hours/month to BobTunes
and they both pay $10 a month. Spotify gets its percentage, say 10%, then $18 gets redistributed as $17.99 to BobTunes's label and $0.01 to Ed Sheeran's label.
Solution:
Both Alice's $9 and Bob's $9 should get redistributed according to what they individually listen. In this simple example they both listen only 1 artist so both of their $9 go to Ed Sheeran's label and BobTune's label.
I think this is a simple solution against bots (or rather, the current distribution type has a serious flaw), and I don't see why wouldn't labels want this.
I haven't proposed anything, I just stated why the fairer distribution of listening time from subscriptions doesn't exist: the major labels will lose money they get from having a split pot from all subscriptions.
Your example makes it perfectly clear, even though BobTunes has 730 hours/month in this example from Bob, in the aggregate of all users listening time their share % of total listening time will be much lower than the total listening time of Ed Sheeran; Ed Sheeran will have millions of people maybe listening a few minutes/an hour while BobTunes might have low thousands, you'd need every BobTunes listener to stream orders of magnitude more time to compensate.
In the current scheme, having major artists with a broad audience listening a little gets a share of the pot that every subscriber funds, for the labels this is great, they make money from the total pot even from non-listeners of their artists, smaller artists from indie labels get a smaller share of the total pot even if they have mega-fans that only listen to them.
That's exactly why the system you describe doesn't exist, the major labels would lose money since they won't collect a share of the pot from subscribers who aren't interested in their artists (like me, for example).
That’s reasonable and fair, but removes a big incentive for musicians: going viral. Many creators are hopeful that by creating a really popular song or songs they can “break out” of a relatively modest earnings band and make it big. For a lot of artists, streaming revenue isn’t enough to live on and thus touring/album sales/promotion/label ownership/other jobs need to be part of their lives. Many of them fantasize about making something so popular that they can do less of that.
Removing the hours-played incentive puts a lot of downward pressure on the curve of “revenue increases when a song/album goes viral”. You still get some of that via massively increased listener counts when you go viral, but with your proposed formula, that number is way attenuated by the number of artists the average person listens to.
Spotify and friends have an incentive to attract and keep lots of artists so they’ll release new content on the platform promptly. Having a revenue model that pays big dividends in the event of a breakout hit is key to attracting artists and/or their labels.
Why would going viral be not as valuable in this method of royalty distribution?
Going viral viral means lots of different people listening to you, and this method helps those people more. A wider audience that listens to fewer hours of your music is better in this scheme compared to a smaller, dedicated audience which is better in the current scheme.
> I can see how it is fraud, but how is it different from all the dark patterns used by newspapers to generate more page prints (like auto-refreshing pages)?
Whether or not something else that someone else does is fraud isn’t relevant. You got to the part where you can see that what he did was fraud. That’s why he got a prison sentence.
So to answer your question, it’s not a crime to publish an AI-generated song, but it is a crime to commit fraud.
The article explains it very clearly near the end:
> The US Justice Department gives the example that the entire catalogue of Taylor Swift received 9.3 million streams on YouTube Music from family plan streams in April 2023., In the same month, Smith’s bot accounts used family plans to fraudulently stream his AI-generated music 80.9 million times.
Basically, the guy got very greedy and generated roughly 10x more streams than a widely popular artist.
It makes me wonder that, if he did significantly less streams, would he have been caught? Are there other fake streams flying under the radar?
> At times SMITH was using as many as 10,000 Bot Accounts at once to fraudulently stream music, and he used fake email accounts and fraudulently-obtained debit cards to create the Bot Accounts
I gather these are cards that he opened and funded, not stolen cards. I'm surprised at this scale it wasn't detected much sooner.
These accounts had to be listening a lot in order to generate more royalties than the subscription fees. e.g. Spotify family is $21.99/mo for six accounts. That's $440K annually for 10,000 accounts. Sheesh.
After talking at length with claude about this case it seems that while botting music streams does meet the bar for wire fraud, creating thousands of fake accounts on walmart to scalp pokemon cards does not. In my opinion these are the same thing, one just pays out from a shared royalty pool and the other on ebay. I guess that's a big difference from a legal perspective, but from a moral and technical perspective they're the same thing. Michael could have applied the same skills and made millions of dollars flipping GPU's and sneakers without any legal consequences. I'm not sure what the takeaway here is but something about this doesn't feel just to me.
With the Pokemon cards you are vaguely harming a nebulous population of other people who wanted to buy the cards from Walmart but won't get the opportunity. Walmart still earns the revenue, so it's hard to explain that you are "stealing" anything of value.
With fake bot streams it is pretty clearly stealing from the other artists who would otherwise get a greater share of the royalties pool. I see your point, but I really have to stretch my imagination to call them morally equivalent.
In terms of choosing the con, the guy calls himself a musician so he probably just fell into it. I bet there was a slippery slope effect: use bots "just a bit" at first to juice the algorithm for his own real songs. Then dabbling with AI generation to tweak the algorithm more, oh the royalty payments feel good, maybe a few more bots...
Automating buying up GPUs when there is a huge demand or shortage* and no risk simple fraud free money from Spotify don't seem any similar to me morally or legally.
* unless there is a special offer by the shop that only allows a limited number of purchases by person. Breaking that would be much closer
Here’s what bothers me: isn’t the United States a free market? What crime did he actually commit? Using services exactly as they are offered? It turns out that now, if you take advantage of the system as it was designed and gain a financial edge, you become a criminal—but if a major corporation does it, they just get a slap on the wrist.
>isn’t the United States a free market? What crime did he actually commit? Using services exactly as they are offered?
From the indictment:
>SMITH’s streaming fraud lasted from 2017 to 2024 and he executed it in three steps. First, SMITH created thousands of fraudulent accounts on the Streaming Platforms (the “Bot Accounts”) that he could use to stream songs. Second, he used software to cause the Bot Accounts to continuously stream purported songs that he owned, which were generally created using super intelligence. Third, Smith collected royalties based on the fraudulent streams he orchestrated his own Bot Accounts to conduct.
>SMITH spread his automated streams across thousands of songs to avoid anomalous streaming as to any single song, which would likely cause the Streaming Platforms to discover his scheme. At times SMITH was using as many as 10,000 Bot Accounts at once to fraudulently stream music, and he used fake email accounts and fraudulently-obtained debit cards to create the Bot Accounts. As SMITH explained it in an email, he needed “a TON of songs fast” in order to circumvent the “anti fraud policies” of the Streaming Platforms. To obtain the necessary number of songs for his scheme to succeed, SMITH turned to super intelligence, which he used to create hundreds of thousands of AI-generated songs for which he could manipulate the streams.
So this isn't even "haha wouldn't it be funny if we make a 10 hour song that's just silence and then convince people to play it while they're sleeping", which would at least be vaguely legal. This is far closer to ad fraud.
> ‘Super intelligence’ is the term that President Donald Trump has ordered government employees to use in documents and statements in the place of ‘artificial intelligence’.
Should be a civil case. The readiness which with the United States incarcerates is a moral disgrace. Especially given the level of criminality the government itself exercises that goes unpunished.
>Should be a civil case. The readiness which with the United States incarcerates is a moral disgrace. Especially given the level of criminality the government itself exercises that goes unpunished.
So what's your actual argument here? Is it
1. whatever he did isn't wire fraud?
2. whatever he did is wire fraud, but wire fraud shouldn't be prosecuted, similar to how crashing a car isn't prosecuted?
3. whatever he did is criminal and should be prosecuted, but trump is abusing his pardoning powers so every other white collar criminal should be off the hook?
What part of doesn't merit a prison sentence escapes you?
I'll take all 3. It really doesn't matter. I don't want this person going to prison in my name. A criminal case is supposed to represent the public interest. A free society is meant to set a high bar to deprive someone of their liberty. The streaming platform can sue him if they like. A civil case that results in punitive damages is also understandable.
In my view, incarceration in this instance is a disgrace. The argument is a moral one, not a legalistic one.
Perhaps the statutes around wire fraud should be reformed. IDK it's not my area, and my argument doesn't rely on a legalistic interpretation, rather it suggests if the law's answer here is to put this person in prison something is wrong with the law. That is the argument. You seem to be asking me how would I codify the solution or else you have misunderstood me.
Bank robbery typically involves violence or the threat of violence. I don’t think the two are really comparable.
To justify imprisonment (rather than purely monetary penalties or civil judgements) you really have to look at the relative scale of harm and the type of harm inflicted. Imprisonment doesn’t always make sense, there are many nonviolent crimes where a purely monetary penalty would be more appropriate. For one thing, imprisonment can prevent people from paying back the victim.
I feel like you are missing the rather obvious or else the note implies. Luckily the law is not so rigid as to be hamstrung by such sophistry. I didn't assault you, I merely invited your face to make an acquaintance with my fist!
The reason the note works is banks don't want to pay the cost of having their employees getting their brains blown out. Passing a note with this understanding means one knows they are making a threat.
Agreed, and if this didn’t involve the threat of violence then imprisonment wouldn’t necessarily be justified—in other words, if this were the case, it would make sense to change the law to a purely monetary penalty. But of course it is an implicit threat!
No? A bank is a regulated entity in the public interest.
Pointing a gun in someone's face is also not in the public interest.
Juicing some streaming numbers hurt who? Spotify's margin? It's not even clear to me without diving into the actual case where he went from getting an edge to engaging in the alleged crime. Or what he could have done differently to preclude criminal prosecution but could have still resulted in a civil case.
More importantly, why should he have to go to prison? Why don't you make that moral argument instead of engaging in such a misread of my position.
>No? A bank is a regulated entity in the public interest.
What does this even mean? Only crimes against things are "regulated" should be prosecuted? Or "public interest", however vaguely that's defined?
>Juicing some streaming numbers hurt who? Spotify's margin?
Other artists. The subscriber/ad revenues are divided pro-rata (unclear whether it's by subscriber or across all subscribers), so by streaming a bunch of fake music, it's displacing the streaming minutes of other artists, ever so slightly.
Moreover, even if it is spotify that's losing money, how is it less in the "public interest" than banks? For the sake of argument let's subtract the threat of violence, and assume they hacked an ATM or something. Would that suddenly not be in the "public interest" to prosecute the offenders? Why should multi-billion dollar banks deserve more sympathy than multi-billion dollar tech companies, especially for crimes that in all likelihood won't lead to either company's demise?
I take it based on your other comments that the distinction between criminal and civil proceedings is suitably apparent to you?
If so I struggle to understand then why this leap is so hard for you.
You and I can have a private dispute without the government getting involved as a prosecuting party, yes? Banks are highly regulated because the state has sought fit to take an interest in how they are run. Roughly, because if a bank defrauds its numerous depositors this incurs a societal cost. Similarly, violence is also regulated, as it is inimical to the state's requisite monopoly on violence to tolerate private expressions of this power.
I simply do not get the intuition here that it is in the public interest to put this person in prison in the same way the intuition may surface in these other cases. If you disagree that is fine, but then I'm curious to hear where your intuition on this private vs public interest line is. Of course it is somewhat vague. If the public interest was clear and obvious to everyone electoral politics would not exist.
Can you offer a positive moral argument for incarceration in this case? Surely you are aware of principles around the burden of proof? Since you seem to be on the pro criminal prosecution side here why don't you take up the burden of saying you want this man to suffer in prison for his crime? I understand your frustration that I don't have all the answers. It would be a more impressive indictment if I was willing to send people to prison under such circumstances.
I take the burden of depriving a fellow citizen of their liberty in a free society rather seriously.
Do you? If so, please explain to me how you alleviate yourself of this burden in this case. I'm open to being persuaded.
So going back to the ATM hacking example, do you think that's criminal or not? What if it's not a "regulated" institution, like an ordinary business? Say you scam Acme Co out of a few million dollars. Luckily for society, Acme Co is a trillion dollar company, so they could stand to lose that. The only harm is to its margins and shareholders, like you said earlier. Does that mean it's fine to hack Acme Co, worst case scenario I have to repay what I stole, and maybe pay their lawyer/cleanup costs?
If you can't clearly articulate what the "public interest" means, it just feels like this whole thing is just a long winded way for you to say that we shouldn't be prosecuting non-violent crimes, unless the victim is sufficiently sympathetic, in which case we throw the book at them. That's no way to run a justice system.
>Can you offer a positive moral argument for incarceration in this case? Surely you are aware of principles around the burden of proof? Since you seem to be on the pro criminal prosecution side here why don't you take up the burden of saying you want this man to suffer in prison for his crime? I understand your frustration that I don't have all the answers. It would be a more impressive indictment if I was willing to send people to prison under such circumstances.
You can make the same arguments about the questionable utility of incarceration for violent crimes too. The typical arguments against incarceration works equally well for violent crimes as they do for non-violent ones.
I think you can look at relative impact and decide this. Did the “white collar” crime wreck people’s lives, leaving them destitute? Jail. Did it kill people through negligence, lowering safety standards, or similar? Jail. Did it hurt the bottom line of a large company by 1% or less with no other obvious impact? Maybe they just have to pay it back plus a large, punitive penalty. Maybe they have to do some public service too. But jail doesn’t really make sense. If anything, jail just prevents them from compensating the victim.
Less than 1/10 of restitution is ever paid out. When you send someone to jail, especially for a long time, you’re basically guaranteeing that they aren’t going to make good on any victim compensation.
>Did it hurt the bottom line of a large company by 1% or less with no other obvious impact? Maybe they just have to pay it back plus a large, punitive penalty. Maybe they have to do some public service too. But jail doesn’t really make sense. If anything, jail just prevents them from compensating the victim.
So what does it mean for the movie trope where a hacker steals fractions of cents from everyone's bank account, leading him to get millions in loot? By any meaningful measure that didn't hurt anyone's bottom line, so that ought to be fine, right? Even if you think this is somehow okay, what about the "death by a thousands cuts" problem, where a trillion dollar company gets scammed 1000 times, which becomes a deleterious amount? Do you have to prosecute people at some point? How would that work?
This wasn't a dispute though. This was clearly fraud, and I think it becomes criminal due to wire fraud (fraud crossing state or national borders).
To me, this falls under the category of white collar crime. I'm OK with white collar criminals serving time. It's not like this case is in a gray area. It's clearly a conspiracy to commit fraud on a large scale.
I get where you're coming from. It's not stealing. But, setting up fake accounts in order to trick Spotify into sending him money is clearly fraud.
> Juicing some streaming numbers hurt who? Spotify's margin?
You don't seem to understand how the streaming revenue model works, and why this is an egregious fraud against the public interest. You believe that stream fraud is someone simply stealing from Spotify/YouTube/etc, so who cares.
In reality, all musicians share a pool of revenue across ads + subscriptions on each platform (typically two-thirds of the total, although each platform has a different rev share model).
This fraud only marginally impacts Spotify financials, as their cut is fixed and taken from the topline [1]. But someone abusing the system like this guy breaks the model for everyone. Not only you're stealing money from millions of musicians, but you're undermining the confidence in the whole industry.
I don't have an opinion if this merits jail time or not, but yes, this is pretty bad. Like money counterfeiting-bad.
[1] ps: of course, if this becomes rampant, musicians get screwed and turn against Spotify, so it's in their best interest to do whatever it take down the fraudsters. It's a never-ending cat-and-mouse game.
As already discussed in other places in this article Spotify chose this model and could well choose one that cannot be abused this way. Why does it need protection by the criminal justice system.
What does it have to do with the crime at hand? Spotify is not asking for special protection. Someone defrauded thousands of musicians; it's the justice's job to step in and ensure markets operate fairly. This is working as intended.
Also, this is not (just) about Spotify; all streaming platforms have some sort of subscription and/or ad revshare, and were abused by the same fraudster.
Per the original case: "Music can be streamed through platforms such as Amazon Music, Apple Music, Spotify, and YouTube Music... SMITH created thousands of fraudulent accounts on the Streaming Platforms that he could use to stream songs".
That doesn't sound like something that should cause someone to be locked away either. Prison should be reserved for people who are too dangerous to be living among the rest of us, along with short jail times when needed to prevent people from fleeing prior to their day in court when the risk of that happening is high enough.
It's true that the state has discretion on whether to pursue a crime, and this is apparently true for harder crimes like murder.
I guess the state prosecution just disagreed on this matter, I'm assuming that, within their specialty, they take the top N cases and dismiss the other pettier cases, and in this case this case made the cut according to the workload capacity of the fraud prosecution workforce.
In raw stolen amounts, it's not small at all, it's like 8 million dollars, which is an amount that can be argued to be worth one or two lives, it may be the cost of complex surgeries and health insurance, or the cost for good nutrition, living space, so it could be argued that this person is taking those resources away from someone else, no matter how inert or ridiculous the means by which they stole that money may be. If someone defrauds 500 million dollars by impersonating a clown, the optics of defrauding 500 million should prevail over the optics of "putting someone in jail for being a clown".
Are you fine with paying $50,000 a year to separate this person from society because he cheated some company? Are we really taking corporate personhood in this direction now?
I don’t believe that people running this kind of scam are engaging in careful moral reasoning about acceptable victims. The man who did this would surely have stolen $50,000 from my grandma if he thought he saw a clever way to get away with it.
You don't have to go that far for bad stuff Spotifys done - at minimum they used pirated libraries back at their start, etc, and they've overall contributed to less payouts for artists. Kind of the Uber of music.
It matters who you're stealing from. And if you're undermining the system itself. This is why counterfeiting currency is considered such a serious crime. If I photocopy a $1 bill, I get, what, $1 for free? That's not that big a deal. But because having fake currency in circulation undermines the entire system, and thus makes for serious crime, so, too, does having fake listeners and getting rich of the royalties. Who cares if Spotify's CEO can't get buy forest in Sweden, in duping the system, it undermines the drive for real actual human people to create music that other actual human people want to listen to. That there are other injustices on the world doesn't undermine this injustice being addressed.
I simply don't buy that this is like copying a $1 bill.
And I don't think you do either. I think one could construct a suitably objective test that would relegate certain instances of this sort of fraud to the civil courts where I think they belong.
Part of the problem is conflating the private Spotify ecosystem with "the system" writ large. In any event, a civil case with appropriate punishment would serve to dissuade others from taking the same action.
I can’t really decide. Punishments for crimes need to be enough to prevent people from doing them. Guy made millions of dollars fraudulently, what’s an acceptable punishment if it’s not jail time?
Same thing with big companies. They knowingly break the law because the punishment is less than what they gain from it. There’s no incentive not to break the law at that point.
A fine of an equal amount + s&p gains on that amount over that period of time. This is not a person who has indicated they would physically be unsafe in society. Many people don’t have the opportunity to lie at that level, but would, are they dangerous and in hiding?
I mean, returning what you stole, surrendering the gains you made from what you stole, and covering the gap of the person you stole from seems pretty reasonable? Like, they were made whole. It's a net loss to the thief.
Prison for theft is so brutally cruel. Who was really harmed by this once he paid the money back? A line item in some megacorp that was lower for awhile?
No one felt anxiety or pain, the megacorp probably barely noticed. Pay them back with interest, move on.
Obviously the calculus changes for violent thefts, or breaking into someone's home. Those cause real emotional impacts to people. Of course simply returning those items doesn't make someone whole.
If they spent a good chunk of it at the time and you don't let them discharge that fine in bankruptcy, isn't that basically a sentence to a life of poverty to pay back the $X million owed? Median US income is about 90k, let's say that left him owing 4M (less than half of 8M + interest), that's 44 years to pay back 4M even if the entirety of your salary was going to it.
Is "forfeit what you've got and go to jail for 18 months" harsher than that? I'd pick the one that let me get a clean start after.
And in the case that it wasn't spent, and by fine you mean as a replacement for any forfeiture, not in addition, then sibling comment has a great point that "if you get caught, you just gotta give it back" is an incentive to commit fraud, not one against committing fraud.
Using the fraudulently obtained debit cards should be a prison sentence. That's real money, from real people.
Don't focus on the streaming revenue angle. Focus on the fact that this was a giant money-laundering exercise, allowing him to turn stolen debit cards into real money.
I don't know that you can make a strong case that the US over-punishes white-collar/economic crime. This isn't drug crime. The average full-of-shit-founder-or-CEO isn't getting locked up. Perhaps the US would be better off with more enforcement of large-scale economic fraud and less of petty drug possession and sales. Put some teeth into due diligence and see if peoples' investments improve.
I find this fascinating, actually. On one hand we must disincentivize fraud. On the other hand enforcement of laws really should have observable utility and not feel arbitrary. I’m much more on the “fix the model” side of the spectrum on this one. That doesn’t mean I think we should allow what SMITH did.
I feel uncomfortable when we start handing out prison for things that are isomorphic in utility to things that seem clearly legal.
Which of these are fraud:
a) I block or skip ads in media I consume
b) 1000 people block or skip ads in media they consume
c) I convince 1000 humans to play my songs every day and all of them listen to the ads
d) I convince 1000 of humans to play my songs every day and all of them skip the ads
e) I program 1000 bots to play my songs every day
(b) (d) and (e) all have the same outcome for ad agencies, nobody hears the ads. If (e) is the only one that’s problematic, then we aren’t solving the problem by prosecuting (e).
Similar vein to Matt Levine’s “everything is securities fraud” takes.
>b) 1000 people block or skip ads in media they consume
Not doing something is generally considered okay, even if it decreases someone else's revenue. eg. saying that a given product is a scam and not worth the money (assuming it's true). Same with skipping ads (eg. TiVo)
>c) I convince 1000 humans to play my songs every day and all of them listen to the ads
>d) I convince 1000 of humans to play my songs every day and all of them skip the ads
Legal, because the whole point of advertising is to convince people to do something, even if it costs someone else money (eg. drugs, which might cost your insurance provider money). Where you might get into trouble is if the actions turn out to be fraud, eg. telling people to stream music, even though no one's listening to it, for the sole purpose of getting streaming minutes, or setting up a kickback scheme (might be tortious interference). Again, going back to the drug example, it's pretty intuitive. Advertising a drug? That's fine. Telling people to buy your drug, just so they can chuck it into the trash, for the sole purpose of enriching yourself? Probably illegal.
> telling people to stream music, even though no one's listening to it, for the sole purpose of getting streaming minutes
How is that fundamentally different from netflix or youtube auto-playing something after a video finishes, knowing that a large percentage of the people who started the first video won't be present or attentive to the second, in order to artificially inflate views for the content they're promoting.
1. the auto-play does eventually stop, presumably because they need to maintain some semblance of legitimacy to advertisers
2. caveat emptor. how youtube works and how ads are played is hardly secret information, so accusations that google is deceiving advertisers (not just providing a subpar product) is hard to make.
3. people have tried suing companies for this, but they were over securities fraud rather than deceiving ad buyers. No idea how successful they were though. it's worth noting that suing for securities fraud is easier because unlike with advertising, you have to declare risk factors, hence why every company's prospectus lists all potential list factors under the sun.
I wasn’t detailed enough. What I was actually curious about is whether it mattered that bots were used.
d.1) convince humans and they use their main account
d.2) convince humans and they use and alt account
I think the resolution to my question is: it’s still fraud if humans do it, like you said. And it makes me wonder if more things should be considered fraud like paying people with free products for Amazon reviews or purchasing GH stars.
So how come Sam Altman & friends aren't in jail yet, but Aaron Swartz was facing life-ruining charges?
If creating bots and mass-violating ToSes for financial gain is fraud while doing bot stuff for fun is totally fine, then clearly the AI companies should be treated like giant criminal cartels, should they not?
the difference is that (d) is not fraud and (e) is fraud, lol. Duh.
you seem to be thinking of the legal system like some kind of programming language / logic paradigm and it is not that and never has been
most likely ad-blocking would also be considered some sort of fraud (or rather: companies would block using their services if the ads were not seen, and then circumventing that would be regarded as fraud) except that it is not politically/socially tenable to do that at all.
It’s rhetorical. Setting aside the obvious credit card fraud because I didn’t know that was a factor when initially asking the question, no it’s not clear to me that using bot accounts to consume a digital streaming service is fraudulent or morally wrong the same way assuming a fake name to use someone else’s credit card is.
I don’t care if a service seeks civil remedy for any damages due to a breach of contract.
I also don’t fancy a future where people have to be worried about criminal penalties for spinning up a bunch of agents to automate something that enriches them.
Is buying likes and gh stars fraud? Is it okay if humans click the star button? Is it okay if a large distributed workload does it?
Anyway my actual stance is that it looks like in this case it’s not the bots that are the key focus of this matter so my earlier comment is mostly just a digression. And that I’d hope this case would be ruled similarly if for example human users were paid to stream his songs, however that would be adjudicated.
Maybe not legally, but morally... yeah? It's definitely gross, in the sense that I would like to see it eradicated as a system.
"Cheating" systems benefits people in the short term but corrupts the, like, fabric of society in the long term ... when cheating is normalized and you have to cheat to get ahead then everything kinda vaguely sucks all the time. People often end up in a posture vis-á-vis big corporations where it feels like cheating them is morally okay because the corporations are cheating in a systemic way, or otherwise don't deserve moral recognition because they're too diffuse and machine-like... I empathize with that. But we shouldn't turn around and therefore _not_ interpret the cheating as cheating. It's still bad. But if you do it "at scale" and make a business model out of it and then get caught... well you're an idiot. I agree that it feels weird that this was a prison sentence instead of a big fine. I imagine it's a question of magnitude: it was more than skimming off a profit, it was basically at the scale of 'criminal enterprise' and we ... don't like those.
> I also don’t fancy a future where people have to be worried about criminal penalties for spinning up a bunch of agents to automate something that enriches them.
It's obviously a question of what you have the agents doing.
> And that I’d hope this case would be ruled similarly if for example human users were paid to stream his songs, however that would be adjudicated.
The nuance is financial extraction coupled with deceit.
If your scheme doesn't extract value, nor costs anything to other parties, there is no victims, you can get away with it. Even if policies say no. The risk is termination of service.
Skipping ads is a loss of opportunity for advertisers. But they don't get extracted money. They may not like it, but they can continue to fish elsewhere and aren't being siphoned because you skip their ads.
If you spawn websites and farm fake viewers to scam ad networks, you are engaged in criminal activity. Not because you fake viewing ads. But because you extracted a profit of this activity which was extracted from another party (via deceits).
Isn't the nuance mostly or only the fraudulently obtained debit cards?
I suspect the case hinged on that, and everything else was legal, albeit part of the fraud, and was included as a complete description of the scheme.
To be fair, I'm guessing he couldn't have created the scale of fake accounts without debit card fraud, but creating multiple accounts, even if they're fake, is usually just a TOS violation, or maybe a civil matter, not criminal.
Could be a separate charge, I agree that's an even clearer cut.
But I was responding to the comment touching on more general seemingly ambiguous situations.
What makes Terms of Service / contract violations a different case than deceit for financial profit. Why is one tolerated by justice but the other condemned as criminal activity.
But you are right, debit card fraud, wire fraud and the likes are clearly defined as criminal.
> but creating multiple accounts, even if they're fake, is usually just a TOS violation, or maybe a civil matter, not criminal.
Yes, in and of itself, creating multiple accounts in violation of TOS is probably not a criminal fraud under either state or federal law.
But when you do it as the mechanism to conceal streaming manipulation in violation of the agreement that governs the terms of payment, and thereby to secure large amounts of money from the streaming service under false pretenses (and, given the structure of streaming payments, to deny payment to other song owners which they would have received without the deception) on the other hand is a different story.
Like yeah, flexing your index finger isn’t a crime, either, but if you are holding a gun with that finger on the trigger and the barrel pointed at someone's head...
The law very often is focussed more than anything about the purpose and effect of an action, and that you can ignore that and describe the action in terms that aren't criminal without considering purpose and effect really doesn't matter.
The fraudulent debit cards are definitely criminal.
Using bots to automate listening to his own songs was likely fraudulent too because he was being awarded royalties. If his songs had been monetized in some other way I'm not sure what he did would be fraud.
I don't think creating multiple accounts is, even if it's in violation of the TOS.
If that was the case, anyone who signs up for multiple accounts on a website/app to get multiple coupons/bonuses/etc... would be committing fraud.
None of this is close to firing a gun pointed at someone's head.
They very clearly made an example of him given the sentencing, but I don't think they were confident about all the charges in the indictment based on the plea agreement and the crazy high succuss rates in federal criminal cases.
I don’t think fraud requires enrichment, does it? I know we commonly associate the two but it’s somewhat of an annoyance IMO that we only care about scheming material
misrepresentation when it involve money.
Edit: interesting it does look like there must be an object of the fraud, likely to prevent the law from being used broadly to punish lying.
Is it fraud for me to spawn a bunch of bots to listen to YOUR music? In fact, this has happened before, and people who are not involved at all get punished for the fraud that they didn’t commit. So it’s a quite tricky problem, and I agree that it just isn’t that straightforward.
This is a thing. You want to hurt someone's business? Buy a bot farm to engage in obvious click fraud on their account. Google or whoever will assume it's them doing it and shut them down, drop them or punish them otherwise. It's like a false flag operation. A superficial investigation will point to "who benefits? well it's clear who's doing this".
Skip is fine. Blocking with third party tools is a breach of contract as a consumer, but not fraud nor a crime.
>b) 1000 people block or skip ads in media they consume.
If they individually decide to do this, then it's 1000 times fine or 1000 instances of breach of contract.
If they get together and do this collectively, or are instructed to do so by one person, it starts to encroach on civil conspiracy.
>c) I convince 1000 humans to play my songs every day and all of them listen to the ads
If you convince them to play the songs on the basis of the music, that's the very object of the contract.
If you convince them to do so on the basis of the ads, presumably you incentivize them with money if they listen to the song, then it's fraud. It's arguable of course, but if you are paying the listeners, then it obviously makes the value of the ads 0, you are knowingly selling something that has 0 value and charging a comission for that sale.
>d) I convince 1000 humans to play my songs every day and all of them to skip the ads
d) This is weird because your revenue would be 0 in this case. But arguably you would be benefitting from the service of music distribution without paying for it with the cost of serving ads along your music. It's a completely different situation than the one in the OP, it's more like piracy, less like fraud.
Again if by skip you mean a service provider interface, then that's fine, I'm assuming you mean block with ublock or some third party reverse engineered thing that's forbidden by ToS.
>e) I program 1000 bots to play my songs every day
e) Of course this is fraud, I think it's obvious to you and you are just positing this as part of the obvious end of the slippery slope, so it's not worth explaining why. But just as a teaser, it involves agreeing and breaching 1000 contracts and creating 1000 fake identities, so identity fraud at least!
>(b) (d) and (e) all have the same outcome for ad agencies, nobody hears the ads. If (e) is the only one that’s problematic, then we aren’t solving the problem by prosecuting (e).
Regardless of the specific case, in general there's many cases where regulation attacks only some scenarios which cause a damage, and that's fine. For example drunk driving, driving too fast, and blinking at the wrong moment all might have the same consequence, but we only regulate the first and the second.
>Similar vein to Matt Levine’s “everything is securities fraud” takes.
Haven't read that, but this is strictly not securities fraud, just fraud.
Yes the list is rhetorical. Yes I am aware this isn’t securities fraud.
Personally, I am not sure I consider pointing a bot at a service to use it, even if it enriches you, generally to be evil or fraud. I think now more than ever the concept of a bot is almost meaningless. So my angle with the comment is to talk about the spectrum and understand why people so clearly see (e) as criminal relative to the other situations when the harm or effective outcome is the same.
We seem generally okay with deception until it is used for personal enrichment. Why is that?
>Personally, I am not sure I consider pointing a bot at a service to use it, even if it enriches you, generally to be evil or fraud. I think now more than ever the concept of a bot is almost meaningless.
I think I said this already, but in the cases of contracts and breach, it's a matter of perspective to interpret whether the gains being defrauded are gaining the consideration of the victim, or in keeping the consideration of the perpetrator, and what you are doing is taking the most charitable of the interpretations, when I think it's very obvious that of both interpretations, the most damaging should be considered.
Example, a rare baseball card is sold for 50M dollars, the 50M dollars are never wired, you would argue that it's just a stupid baseball card, when I think we should consider that 5M were stolen. The inverse scenario would be the same thing, if the 50M are wired, but the perpetrator keeps the baseball card, you would argue that it's just a baseball card, but I would say that it's fraud for 50M.
Market value is often considered, in which case it depends on third party estimations as for the true value of the thing. Which in the case of the streaming service, I don't think there's an overpricing here at all. 80M fake plays at 8M USD is like 10 cents per ad, maybe you can argue that it really was 1 cent per ad and the sentence should be lower at 800k? But it's a very weak position to argue on subjective grounds that the asset being traded is morally not something that people should be going to jail for. It would require every trial to judge not only the contract and the facts of the case but what the object of the contract was and whether it is 'serious' enough, effectively carving out some assets as 'serious' like food and oil, while others are unserious and subject to fraud, like music and software. You are effectively arguing against our trade in a way by devaluing intangible assets whose value and contracts we rely on to make a living.
No that’s not my argument actually. I don’t think theft here is justified just because it’s a streaming service or big ad or it’s just a click. There’s a real crime here.
I am uncomfortable with the idea that something that is allowed if you pay humans is also illegal if you use bots. That feels like it deserves more discussion. And it feels like while there is a clear crime here, it’s also a problem that the ad and streaming industry have a model that reduces one stream to one human. I don’t want to worry about jail time for automating tasks with bots and accidentally falling on the wrong side of some industry’s really bad/dated monetization model and having it look like fraud. That isn’t the case here, but it encroaches.
"Money going to one person through deceit that would've otherwise gone to others" has a pretty material utility impact on the "others," even if they're a large aggregate or if they're corporate interests/investors who "have enough money."
I lean fairly redistributive but through consensus and governance, not through fraud.
It’s not about redistribution for me. I’m not of the mind “fuck big advertising and streaming any theft from them is justified”.
It was more about making sure we don’t punish people for something that would otherwise be legal if they paid humans to do it but instead used bots. And it doesn’t seem like that was the case here after more discussion panned out.
And also that we don’t ignore the minor but still real part of this that’s due to a really poor assumption that “one stream == one human”.
Advertisers are fine with paying for ads even of some users turn the volume down when they come on. They are absolutely not fine with paying for ads streamed out into nothingness.
One is a problem for the industry. The other is not.
>To obtain the necessary number of songs for his scheme to succeed, SMITH turned to super intelligence, which he used to create hundreds of thousands of AI-generated songs for which he could manipulate the streams.
The best part about all the insistence about it being the Department of War, is that Hegseth is still the secretary of defense
The original purpose of the org was also explicitly defensive, with failing to prevent Pearl Harbor being an explicit influence for improving communication and cooperation between arms of the military through a combined leadership.
I'm sure he was thinking about the divisiveness of the term 'AI' and not the millions of dollars AI companies have given him or the massive amounts of money he and his family hold in investments in AI data centers.
"Can we find an even-more Matrix/Terminator-sounding name??"
I wouldn't be surprised if it was industry-pushed to try to get people used to the idea of "don't question the machine, let us replace you." Are you "super", after all?
Considering the White House's market-manipulation and unprecedented insider stock trading in the last year, I would not be surprised if it's part of another corrupt scheme.
For example, pump-and-dumping .si domain names or some other asset which connects to the phrase/acronym.
I find the domain name theory funny/sad and par for the course, but it does seem like an awfully inefficient method of corruption compared to what shitler and his pals have been up to so far, no?
Like going from very successfully robbing banks to robbing convenience stores?
I have always been surprised by the pettiness and vulgarity of corruption. Sometimes Trump tries to steal $10,000,000,000 from the IRS, but sometimes he hawks branded Bibles for $59.99. I don't understand why someone with more money than he could spend in a dozen lifetimes regularly humiliates himself for a few grand.
Completely agree about his business ventures and entire career. But his presidential grifts, and those of his family, do look highly effective and successful. Compared to those, a domain name pump-and-dump seems outright pathetically inefficient.
It's also just a coincidence that his kids, who have no background in technology and no knowledge of programming or cryptography have a crypto coin company that sells, nothing of value, with, basically 0 advertising, and makes billions of dollars, mostly from deals with Gulf Arab dictators, who then get favorable deals with their dad ...
A plead to Slovenian registrars: add a condition that says the annual fee for .si domains doubles every time the owner uses the phrase "superior intelligence".
One of the talking heads was pointing that the AI has emphasis on "artificial" - created by humans - whereis super intelligence brings up the idea of something super/above to humans, and that among others has the political dimension of democracy - power of the people - vs. dictatorship - power over people.
Careful, promoting thoughtcrime by malquoting Miniluv based on old documents that have not been rectified by Minitrue with the latest updates to newspeak could land you in a joycamp.
What's a "fake" email account? According to the law, that is. Does that mean that having more than one (let's say) email account might now be considered as "fake", and hence potentially illegal?
Generating the AI music wasn't illegal. Using bots to inflate /listens/ of an AI-generated song probably is against a platform's TOS, but isn't inherently illegal.
However, using bots to collect royalties on the songs generated definitely fits within the definition of wire fraud as he was using electronic communications (i.e., the internet), to carry out a scheme to defraud streaming services of money.
From the statement: At times SMITH was using as many as 10,000 Bot Accounts at once to fraudulently stream music, and he used fake email accounts and fraudulently-obtained debit cards to create the Bot Accounts.
So the bots he actually used were most likely illegal (though it's true other bots might not be).
Using bots to defraud the platforms and get royalties he didn’t actually earn sounds like a crime to me, but what do I know. Maybe I should just make a Trump joke.
A class-action lawsuit is "still being fought at the pleading stage" [1]. The way this often goes is prosecutors will watch the discovery in that case to decide if anyone committed a crime.
> way this often goes is prosecutors will watch the discovery
>> there was no criminal prosecution, just a lawsuit
Like, come on. (This reminds me of the folks on HN confidently concluding Elizabeth Holmes wouldn’t see the inside of a jail all the way through sentencing.)
> It turns out that now, if you take advantage of the system as it was designed and gain a financial edge, you become a criminal
Yes, exactly. Traditionally, fraud consists of lying to obtain something you wouldn't have gotten otherwise. This seems sensible, right?
But corpos have figured out how to abuse this - create a long list of business-method-desires in their "terms of service" (aka the legalese diarrhea that nobody reads). The corpos then take the position that merely by using their service as presented, users have take on responsibility for representing that they will abide by the listed whims. When it turns out that users' interests differ from the corpo's whims, and a user does something they majorly don't like, they cry fraud.
In the past, this was limited by the facts that 1. legalese diarrhea wasn't really involved in day to day transactions (we relied on legislative law made by public bodies rather than private law unilaterally promulgated by corpos) and 2. when you bought something, the seller's control over it simply ended. Both of those assumptions have been blown away by pervasive communications, and we really need some reform here.
The 'free' in free markets is a spectrum. A market without anyone enforcing limits will just coalesce to a couple large player(s), and won't remain free for long.
> if you take advantage of the system as it was designed and gain a financial edge, you become a criminal—but if a major corporation does it, they just get a slap on the wrist.
You don't even need to be a major corporation to get away with it. You can be an individual if you have the right connections.
I believe what this guy did with the music streaming was wrong. But I also think whatever punishment he gets should be shared by someone who, say, lies about their 500 active user worthless company to unload it for tens of millions of dollars.
But one of these people is going to jail for a year and a half and one is preparing to launch a trillion+ dollar IPO.
Likely a ToS violation. But is this enough for a crime?
"“Michael Smith exploited super intelligence technology to generate a fraud,” said US Attorney Jamie McDonald. “By flooding music streaming platforms with automated bots in the place of consumers, and fake songs in the place of creativity, Smith robbed millions in royalty payments from genuine artists and their fans."
This state attorney does not seem to be the sharpest tool in the box or I don't get it.
1. I don't see any possible way how he could have stolen from the fans of the artists.
2. If he stole from the artists, then this must be a fixed amount of money in the pot and the slice of the piece of the cake gets smaller, if more people withdraw. There might be such an arrangement between artists and the streaming provider but I don't know details.
Literally the next full paragraph after your quote:
“Royalty payments are made proportionately to musicians and songwriters from a pool of funds. As a result, streaming fraud diverts funds from musicians and songwriters whose songs were legitimately streamed by real consumers to those who use automation to falsely create the appearance of legitimate streaming.”
I don’t think the issue is the fact that the songs were AI generated as much as it is he faked tens of thousands of customers (presumably in free tiers) streaming the songs that he owned in order to collect royalties. That does indeed sound like garden variety fraud to me.
If you and I have a contract that I’ll pay you for unique shoppers referred to my store and you just go in yourself to trigger the door counter 10,000 times wearing different disguises, it’s pretty clear that you have defrauded me.
Fraud: lying in the inducement or fulfilment of a contract.
If lying to induce or fulfil a contract were not a crime, someone could sell you a car telling you it has 0km, but it's actually 300km. Or they could sell you a hamburger telling you its made of meat, and it's actually made of soy. Etc..
Selling a song with 100M listens is a lie if you faked those 100M listens, it's not very different from stealing (but it is different)
I'm reminded of the words of "Smokey" Yunick who said "I never cheated a day in my life. I just read the rules better than the people who wrote them."
That is what I see with this case. Aside from the debit card thing I am not certain any laws were broken. If making "bots and socks" to manipulate for profit is illegal there is a lot more areas that I would love to see them gone from.
This is a common mistake technical people make when discussing legal topics: they look for technical compliance. I can see why. You try and prove that code works. You think about invariants, preconditions and postconditions.
The law doesn't work that way. So much of the law comes down to holistic and subjective tests. It looks at the totality of the evidence. Those tests typically also contain questions that are also tests.
Let me give you an example: the FBI gets access to a site hosting CSAM and, in doing so, they get IP logs. Many of those logs point to US IP addresses. From this they make arrests and prosecutions.
The typical engineer defense is "you can't prove that use of my IP was me", like you could've been hacked. While that's technically true, the law doesn't work on absolute certainty. Investigators and prosecutors will do things like figure out if you were home at the time, if there's any corroborating evidence on any of your devices and so on.
So back to streaming, you look at the totality of the accused's actions. Did he get mass copies of copyrighted music? As BS as IP is (IMHO), stealing it is still a crime. Using services within their ToS isn't a defense. And the fact that you committed a crime probably means you violated the ToS anyway. Dig in there and you'll probably find stuff about not doing things that aren't illegal.
NAL. My guess is it's debit card fraud plus everything else.
If the debit card fraud wasn't present, and it was instead a group of individuals doing this, I'm not sure if it would end up in criminal court. It could still end up in civil court.
They got him on wire fraud. Everytime a case has a shaky legal basis, they go for wire fraud. The legalese is stupidly broad, encompassing, and comes with huge penalties. [1] Up to 20 years in prison for any scheme to defraud that uses practically any digital tech at any point. It probably made sense in the 50s when wire fraud would have been quite a specific sort of crime, but in the era of the internet - now basically anything and everything can be construed to be wire fraud.
In Kelly vs US [1] a couple of politicians were convicted of wire fraud for closing certain lanes to create a traffic jam for political benefit. It was overturned by the Supreme Court but that gets into interpretive arguments of what the statute means when it says "OR". The law isn't like code. Anyhow, yeah the wire fraud statute really needs to be rewritten or broken down into more appropriate and targeted statutes. But that will never happen because it's a superweapon in its current state.
The problem here is that basically everything is wire fraud. For instance if you wrote a lie to me on these forums with the intent to somehow enrich yourself, that could viably be seen as felony wire fraud - with up to 20 years in prison. Exaggerated credentials on a CV you sent by email? Wire fraud. Emailing in for sick leave when you're not? Wire fraud. Most of us have committed wire fraud, probably multiple times, throughout our lives. Obviously you're not going to be charge with wire fraud for those sort of things in practice, at least not unless the government wants to nail you. And I think that nuance of them just being able to tack on heavy charges at their discretion is quite undesirable.
That's not to say we should encourage lying or botting or whatever else, but they need their own statutes as opposed to a 50s era law which has turned into a catch-all superlaw with really harsh penalties. So in this case exactly what was the crime committed? Terms of service violations aren't illegal, neither is lying to or exploiting companies, neither is running bots. Wire fraud is dragged out exactly in circumstances like this when the government wants a conviction but it's not clear what law was broken, because even if no law was broken, they probably committed wire fraud, because everything is wire fraud.
It's also a highly asymmetric law. For instance Sony famously got the No Man's Sky (video game) people to lie through their teeth about what the game was going to include. They made countless millions of dollars from these lies. That's 100% wire fraud, but because they're a giant company lying and exploiting people 'by wire' is just standard operating procedure, and they didn't even get a slap on the wrist. For that matter all false advertising would be wire fraud, but again that gets back to the point that everything is wire fraud.
I am accustomed to employing sarcasm, irony, satire, fiction and all sorts of devices in my speech and rhetoric. However it seems that sort of goofing-around isn't really supported by mainstream social media platforms. I have had several close friends and colleagues humorlessly prompt me to be more serious and less chaotic, especially on Facebook.
I can understand that saying things we don't sincerely mean, and outright lying or being insincere for supposed comedic or dramatic effect, can be utterly misconstrued in a public forum. Sadly, my mind is really conditioned to not even care what are the effects of what I say when I'm typing it into a computer.
I try not to maintain any public social media accounts, and so hopefully my sardonic sense of humor can be contained to friends and allies who sort of understand where I'm coming from.
Let's turn the tables. Imagine instead of an individual doing this, it was a company doing basically the same thing but in reverse. So they populated their site with bots creating fabricated posts and people to drive 'manufactured engagement' from their users, try to reach critical mass, bloat their advertisement appeal, and generally make a bunch of money.
Is it still a felony worth spending years in prison for? I am speaking practically, not ideologically. The main thing this user did was to exploit advertisers paying out on the world's most gameable metric (exactly as our site would be doing in the above example). Yet that, in and of itself, is not a crime, which is why they ended up relying on wire fraud charges.
> By flooding music streaming platforms with automated bots in the place of consumers, and fake songs in the place of creativity, Smith robbed millions in royalty payments from genuine artists and their fans. This Office is committed to ensuring the integrity of all markets, and protecting the public from those who use super intelligence for fraud.
He certainly didn’t defraud artists or their fans. This is false framing. He defrauded the streaming platform, which I’m sure the jury would be far less empathetic towards.
This is true, but kind of on the streaming platforms for having a terrible pooled monetization scheme that lets high frequency users allocate the subscription money of low frequency users.
It says he robbed royalty payments which is true because of the way most of these services distribute royalties. All listens go into a global pool and count the same amount. So if you listen 20 hours a day, you control not only the royalty payments from your subscription but the royalty payments from several other people's subscriptions.
I am so going to force Gemini to consume as many google ads as google tries to foist on me. Brilliant idea. By their own definition that is just training right?
When has any Facebook executive ever gotten a prison sentence for their horrendous doings? They just pirated all of Anna's Archive to feed into their AI.
Our legal system has been turned into a tool to punish the poor and enrich the wealthy.
Meta, Google and Apple are all currently claiming immunity in court for the explicitly illegal stuff they distribute and profit from - from scam ads and apps to illegal gambling apps.
I’m up for anyone and everyone pointing it out until it’s fixed. Which is hopefully one step on the path to action, which is on the path to change, and eventually resolution. Justice and fairness will be an ever present battle or at least vigilance.
"Taylor Swift received 9.3 million streams on YouTube Music from family plan streams in April 2023., In the same month, Smith’s bot accounts used family plans to fraudulently stream his AI-generated music 80.9 million times."
what always fascinates me about crime like this is, if this guy hadn't tried to make 8 million dollars with 10k bot accounts and boosted himself straight to the top, he could have easily made a few thousand per month. How are people clever enough to set this scheme up to begin with but don't consider that you maybe shouldn't try to alert the entire fraud department
Because you as a user don't distribute your $15. It's not like if you listen to one artist only, that artist gets your $15. Instead they throw it all into one pot and distribute it in accordance to the total plays. This is why Taylor Swift gets most of your money even when you didn't listen to her. I wish it was different.
> ...(‘Super intelligence’ is the term that President Donald Trump has ordered government employees to use in documents and statements in the place of ‘artificial intelligence’.)
Meanwhile, other threads are blasting data centers for their energy consumption. At least that use seems like it should be somewhat efficient.
Bot armies ( trained to be inefficient to avoid detection ) streaming music over the wire en masse seems pretty wasteful. I wonder how many others are doing it?
The whole entire problem is the system that is used to divide the income from songs. If it it was "the share of your subscription (or whatever ad-supported account is worth) gets divided to the songs you listen", most of the problem would be gone, at the very least for money from subscription accounts.
Instead, it is all dumped in one big pool and distributed by total listens.
Which means, if you listen to more songs, you have more "voting power" on who gets the money. Absolutely asinine system.
Part of this does seem objectionable. But uhh, the other half, yikes. Superintelligence: ok for capital, not allowed for individuals.
> "Michael Smith exploited super intelligence technology to generate a fraud,” said U.S. Attorney Jamie McDonald. “By flooding music streaming platforms with automated bots in the place of consumers, and fake songs in the place of creativity, Smith robbed millions in royalty payments from genuine artists and their fans. This Office is committed to ensuring the integrity of all markets, and protecting the public from those who use super intelligence for fraud."
Wow, uh, he had a time machine?
> Smith’s streaming fraud lasted from 2017 to 2024
"AI" is now an unword. The all-powerful delusional sociopath in the White House has decreed the latest bit of Newspeak, and the spineless cowards throughout the government are scrambling to make sure to stay in lockstep with The Party.
This U.S. Attorney is obviously frightened he'll be taken to re-education should he use banned terminology.
I asked super intelligence to determine if a series converges or diverges yesterday. It said cos(1 + n * pi) is always positive for all n… I must be wrong, not the super intelligence.
People here in HN seem to believe that royalty collecting companies are some sort of charitable organizations for the benefit of the artists. But their conduct and practices range from questionable [1] to outright fraudulent [2]. And now they manage to fly below the radar, because everyone (artists included) is busy bashing Spotify. These companies would sue Spotify out of existence had they offered the option to directly pay the artists instead of going through them.
Feels like some kind of sentence to make an example of someone to scare off other people ala going after grandmas for napster. There's way too much of this going on on instagram and tiktok etc etc already. They went after this guy but is letting many people get away with it.
What I don’t understand. Why are the platforms not just splitting each payers monthly subscription with all the songs they have played that month. If I only play one song - it’s 12.99 for Rick Astley. Or if someone plays music 24/7 their streams are worth much less. That seems like a much fairer system that is impossible to abuse. For ad supported users you can still defraud the advertisers of course
> For ad supported users you can still defraud the advertisers of course
Who do you think receives the ad money paid by advertisers?
I am not sure I understand. Surely a AI generated song isn't a "fake song"? Is it a crime to publish an AI generated song?
It seems that what he is guilty of is to generate some fake users pretending to listen to his songs, is that right? I can see how it is fraud, but how is it different from all the dark patterns used by newspapers to generate more page prints (like auto-refreshing pages)?
Seems like a ToS violation more than anything
I agree thats more appropriate. There is nothing AI here, its just simple automation. Couple things that are probably applicable in this case or cases like this where royalties are earned based on assumed advertising traffic
1. There is no way he the the only one or first one. Chances are that more than likely he was subscribing to some third party services which were offering this feature.
2. He probably took it too far to get noticed and get in limelight
There's illicit enrichment so it's not like just getting likes.
When you deliberately violate a TOS using deception in order to get money or property from a service, you're committing fraud.
There are plenty of ways to violate a TOS non-remuneratively or without using deception ("deception" is an element of the crime of fraud and has to be proved up in court; it's not simply what the TOS says it is). Those are civil matters, not crime.
The template you want to be working from: lying for money is fraud.
Unless you are facebook, Musk, OpenAI, Antropic, Thiel, ...
That argument won't play at all in front of a judge. I'm commenting positively, not normatively.
I wonder if this person could have been held liable personally if they had operated under a LLC.
It depends on how the LLC is set up and operated. Courts do have the power to “pierce the corporate veil” if a business entity is just a sham.
LLC shielding and veil-piercing are almost always applied to civil cases. TFA describes a criminal case.
True, however, I'm responding to the specific question about liability (which is civil) vs. guilt (which is criminal).
He is not guilt of using AI to create songs.
He is guilty of creating a bot farm to stream his music, to increase his user count to earn royalties, which is fraud.
A stretch IMO. They were are all real paid users, just “agentic” bot users.
He is still defrauding the streaming platform. It is like creating a userbase just to get investments in your company.
If that "created" userbase give you the similar profit of "real" userbase, i dont see what's wrong.
It wasn’t giving Spotify similar profit, though. Their subscription pricing assumes both a) ads and b) that on average listeners won’t listen more than a certain amount, and will listen relatively broadly such that a single artist isn’t disproportionately rewarded (and thus lots of different artists find it lucrative to be on the platform, increasing its appeal).
In short, this isn’t a “cool infinite money hack” whereby you can pay a subscription fee and make it back with dividends as an artist. Instead, it’s https://xkcd.com/1494/
You need help understanding why spotify paying a man for fake users isn't being defrauded?
Didn't reddit famously do this.
If he created a startup to do the exactly same thing, he would be a millionaire.
Matter of factly, if he did create a bot farm for hire, and NOT get paid for streaming, but paid just to scale the bots FOR other people, yes lol
That startup exists already it is an A16Z thing.
Or like streaming artists music to users while not paying the artists.
> Surely a AI generated song isn't a "fake song"?
Eh.
> Is it a crime to publish an AI generated song?
It's not. And a lot of this fraud was done with non-AI songs. But it helps show his attitude.
> It seems that what he is guilty of is to generate some fake users pretending to listen to his songs, is that right? I can see how it is fraud, but how is it different from all the dark patterns used by newspapers to generate more page prints (like auto-refreshing pages)?
Does that get them more money just for showing the ads? Usually the number of page views is up to you. If you find a way to make oodles of money off a mechanism like that, it very well might be criminal fraud!
If he used bots to stream his own song 80 million times then folks at the streaming services would notice. Instead he spread the 80 million fraudulent streams over tens of thousands of machine generated songs.
From what I've read they weren't AI generated songs of the kind that come to mind when most of us think of AI generated songs.
They were just simple short instrument loops (a basic drum machine beat, a short bass line, a few piano notes) repeating indefinitely, white noise, drones, and such.
At this point, it all becomes art and should be celebrated.
This actually doesn’t have anything to do with AI, especially since the scheme started in 2017.
The fraud is only possible because of the way the streaming revenue sharing is split. The way royalties are paid by streamers can basically be summed up by the equation: (total subscription revenue * some agreed to percentage) / total hours streamed by all subscribers for all songs * total hours your songs were streamed.
So let’s say total revenue is $1 million and the artists get 10% of revenue, and there is a total of 1 million hours of streamed music by those subscribers. This means that artists will earn 10 cents for every hour their song is streamed.
On the surface, this seems like a pretty fair way to distribute revenue.
However, what this means that a user who streams more will generate more revenue for artists than a user who streams less, even though the two users pay the same price for their subscription.
For example, imagine a streamer only has two customers, Bob and Alice. If Bob listens to 99 hours of Artist A, while Alice listens to 1 hour of Artist B, then Artist A will get 99 times as much revenue as Artist B, even though they both have one fan and they both pay the same.
So you can see how this could be abused; if I sign up for an account and have it stream my music 24 hours a day, 7 days a week, I am going to have more hours streamed than 20 average users, meaning I end up earning more revenue in royalties than I paid for my subscription (since even though I only get 10% of the revenue, my 20x the average subscriber volume means I end up with 2x my subscription cost in revenue)
If I do this thousands of times, I can make serious money… like this guy did, apparently.
There is a simple fix for this, and I think it actually makes it more fair for artists; do the revenue split on a per user basis. In other words, if 10% of revenue goes to the artists, you take 10% of an individual subscribers subscription price, and divide it up amongst all the artists that user streamed based on time streamed. For example, if my sub costs $10, $1 goes to the artists I stream. If I only listen to one artist, they get the $1 no matter how many hours I stream.
This ensures that a single user can never direct more than their own 10% to an artist, and you would have no incentive to stream your own music.
This seems fair and reasonable to me.
> There is a simple fix for this, and I think it actually makes it more fair for artists; do the revenue split on a per user basis. In other words, if 10% of revenue goes to the artists, you take 10% of an individual subscribers subscription price, and divide it up amongst all the artists that user streamed based on time streamed. For example, if my sub costs $10, $1 goes to the artists I stream. If I only listen to one artist, they get the $1 no matter how many hours I stream.
It's much fairer which unfortunately pisses off the Big 3 major publishers, and they've blocked any attempt by streamers to use this model.
I believe Spotify briefly attempted it in the late 2010s before having to shutdown a similar revenue-sharing system as the one you described from pressure by the major labels.
I don't understand why a label wouldn't like this model...
Makes me wonder if the big players aren't bot-farming too... Perhaps to get to the top of 'most played' rankings...
> I don't understand why a label wouldn't like this model...
It’s pretty obvious, isn’t it? They’d make less money and they have a lot of leverage over Spotify to force it to accept pretty much whatever terms that benefits the big labels at the expense of indies.
Interestingly this gives rise to a business opportunity for indies. Create an indie-only music service that doesn't include the big labels, and encourage indie lovers to use it on the basis that artists get more of their money that way. They should still be able to manage viable margins since they don't have to sink disprortionate royalties to the big labels.
The total amount of money going to artists doesn’t change in either system, the only change is with which artists get what fraction of the money paid.
Artists with larger fanbases will prefer the newer method, while smaller artists with dedicated followers would prefer the current method.
They make less money, the size of the pot used to disburse royalties to them becomes capped at the max amount paid by subscribers listening to their artists instead of the whole revenue coming from subscriptions.
I don't get your reasoning but I also don't think your conclusion holds.
A simple solution is just a saner redistribution of the money paid by users according to their listening habits. Isn't that what you've proposed?
Assume that currently:
and they both pay $10 a month. Spotify gets its percentage, say 10%, then $18 gets redistributed as $17.99 to BobTunes's label and $0.01 to Ed Sheeran's label.
Solution:
Both Alice's $9 and Bob's $9 should get redistributed according to what they individually listen. In this simple example they both listen only 1 artist so both of their $9 go to Ed Sheeran's label and BobTune's label.
I think this is a simple solution against bots (or rather, the current distribution type has a serious flaw), and I don't see why wouldn't labels want this.
I haven't proposed anything, I just stated why the fairer distribution of listening time from subscriptions doesn't exist: the major labels will lose money they get from having a split pot from all subscriptions.
Your example makes it perfectly clear, even though BobTunes has 730 hours/month in this example from Bob, in the aggregate of all users listening time their share % of total listening time will be much lower than the total listening time of Ed Sheeran; Ed Sheeran will have millions of people maybe listening a few minutes/an hour while BobTunes might have low thousands, you'd need every BobTunes listener to stream orders of magnitude more time to compensate.
In the current scheme, having major artists with a broad audience listening a little gets a share of the pot that every subscriber funds, for the labels this is great, they make money from the total pot even from non-listeners of their artists, smaller artists from indie labels get a smaller share of the total pot even if they have mega-fans that only listen to them.
That's exactly why the system you describe doesn't exist, the major labels would lose money since they won't collect a share of the pot from subscribers who aren't interested in their artists (like me, for example).
> I haven't proposed anything,
Oh it was cortesoft who proposed this and not you. Should've double checked instead of going with the idea that you forgot your position in 2 replies.
The crime here isn't bot-farming, it's bot-farming without prior permission.
The industry is notoriously corrupt, and not a stranger to pay-per-play of various kinds.
That’s reasonable and fair, but removes a big incentive for musicians: going viral. Many creators are hopeful that by creating a really popular song or songs they can “break out” of a relatively modest earnings band and make it big. For a lot of artists, streaming revenue isn’t enough to live on and thus touring/album sales/promotion/label ownership/other jobs need to be part of their lives. Many of them fantasize about making something so popular that they can do less of that.
Removing the hours-played incentive puts a lot of downward pressure on the curve of “revenue increases when a song/album goes viral”. You still get some of that via massively increased listener counts when you go viral, but with your proposed formula, that number is way attenuated by the number of artists the average person listens to.
Spotify and friends have an incentive to attract and keep lots of artists so they’ll release new content on the platform promptly. Having a revenue model that pays big dividends in the event of a breakout hit is key to attracting artists and/or their labels.
Why would going viral be not as valuable in this method of royalty distribution?
Going viral viral means lots of different people listening to you, and this method helps those people more. A wider audience that listens to fewer hours of your music is better in this scheme compared to a smaller, dedicated audience which is better in the current scheme.
Whether or not something else that someone else does is fraud isn’t relevant. You got to the part where you can see that what he did was fraud. That’s why he got a prison sentence.
So to answer your question, it’s not a crime to publish an AI-generated song, but it is a crime to commit fraud.
The article explains it very clearly near the end:
> The US Justice Department gives the example that the entire catalogue of Taylor Swift received 9.3 million streams on YouTube Music from family plan streams in April 2023., In the same month, Smith’s bot accounts used family plans to fraudulently stream his AI-generated music 80.9 million times.
Basically, the guy got very greedy and generated roughly 10x more streams than a widely popular artist.
It makes me wonder that, if he did significantly less streams, would he have been caught? Are there other fake streams flying under the radar?
> At times SMITH was using as many as 10,000 Bot Accounts at once to fraudulently stream music, and he used fake email accounts and fraudulently-obtained debit cards to create the Bot Accounts
I gather these are cards that he opened and funded, not stolen cards. I'm surprised at this scale it wasn't detected much sooner.
These accounts had to be listening a lot in order to generate more royalties than the subscription fees. e.g. Spotify family is $21.99/mo for six accounts. That's $440K annually for 10,000 accounts. Sheesh.
After talking at length with claude about this case it seems that while botting music streams does meet the bar for wire fraud, creating thousands of fake accounts on walmart to scalp pokemon cards does not. In my opinion these are the same thing, one just pays out from a shared royalty pool and the other on ebay. I guess that's a big difference from a legal perspective, but from a moral and technical perspective they're the same thing. Michael could have applied the same skills and made millions of dollars flipping GPU's and sneakers without any legal consequences. I'm not sure what the takeaway here is but something about this doesn't feel just to me.
Does it reference any specific case law/etc...?
The law is an ass?
With the Pokemon cards you are vaguely harming a nebulous population of other people who wanted to buy the cards from Walmart but won't get the opportunity. Walmart still earns the revenue, so it's hard to explain that you are "stealing" anything of value.
With fake bot streams it is pretty clearly stealing from the other artists who would otherwise get a greater share of the royalties pool. I see your point, but I really have to stretch my imagination to call them morally equivalent.
In terms of choosing the con, the guy calls himself a musician so he probably just fell into it. I bet there was a slippery slope effect: use bots "just a bit" at first to juice the algorithm for his own real songs. Then dabbling with AI generation to tweak the algorithm more, oh the royalty payments feel good, maybe a few more bots...
At what point in the slope does a regular musician fall toward credit card theft to pay for premium streaming accounts
I don't see what you don't see here.
Automating buying up GPUs when there is a huge demand or shortage* and no risk simple fraud free money from Spotify don't seem any similar to me morally or legally.
* unless there is a special offer by the shop that only allows a limited number of purchases by person. Breaking that would be much closer
If Spotify royalties were allocated fairly a scheme like this shouldn't be able to pull more money out than the subscriptions put in.
Here’s what bothers me: isn’t the United States a free market? What crime did he actually commit? Using services exactly as they are offered? It turns out that now, if you take advantage of the system as it was designed and gain a financial edge, you become a criminal—but if a major corporation does it, they just get a slap on the wrist.
>isn’t the United States a free market? What crime did he actually commit? Using services exactly as they are offered?
From the indictment:
>SMITH’s streaming fraud lasted from 2017 to 2024 and he executed it in three steps. First, SMITH created thousands of fraudulent accounts on the Streaming Platforms (the “Bot Accounts”) that he could use to stream songs. Second, he used software to cause the Bot Accounts to continuously stream purported songs that he owned, which were generally created using super intelligence. Third, Smith collected royalties based on the fraudulent streams he orchestrated his own Bot Accounts to conduct.
>SMITH spread his automated streams across thousands of songs to avoid anomalous streaming as to any single song, which would likely cause the Streaming Platforms to discover his scheme. At times SMITH was using as many as 10,000 Bot Accounts at once to fraudulently stream music, and he used fake email accounts and fraudulently-obtained debit cards to create the Bot Accounts. As SMITH explained it in an email, he needed “a TON of songs fast” in order to circumvent the “anti fraud policies” of the Streaming Platforms. To obtain the necessary number of songs for his scheme to succeed, SMITH turned to super intelligence, which he used to create hundreds of thousands of AI-generated songs for which he could manipulate the streams.
So this isn't even "haha wouldn't it be funny if we make a 10 hour song that's just silence and then convince people to play it while they're sleeping", which would at least be vaguely legal. This is far closer to ad fraud.
They actually used the term super intelligence.
I hate this timeline.
Article mentions they've been ordered to:
> ‘Super intelligence’ is the term that President Donald Trump has ordered government employees to use in documents and statements in the place of ‘artificial intelligence’.
Very disappointing.
Surprised it is not "Super Intelligence of America"
That's Lake Super Intelligence to you.
(Like Superior Intelligence, I believe?)
Too late to edit: Lake Superior Intelligence (duh).
There is a Gulf of Super Intelligence.
I'm just surprised he didn't rename it to American Intelligence.
I never in a thousand years would have imagined that we would have Super Intelligence thanks to Donald Trump. /s
None of this merits a prison sentence to me.
Should be a civil case. The readiness which with the United States incarcerates is a moral disgrace. Especially given the level of criminality the government itself exercises that goes unpunished.
>Should be a civil case. The readiness which with the United States incarcerates is a moral disgrace. Especially given the level of criminality the government itself exercises that goes unpunished.
So what's your actual argument here? Is it
1. whatever he did isn't wire fraud?
2. whatever he did is wire fraud, but wire fraud shouldn't be prosecuted, similar to how crashing a car isn't prosecuted?
3. whatever he did is criminal and should be prosecuted, but trump is abusing his pardoning powers so every other white collar criminal should be off the hook?
What part of doesn't merit a prison sentence escapes you?
I'll take all 3. It really doesn't matter. I don't want this person going to prison in my name. A criminal case is supposed to represent the public interest. A free society is meant to set a high bar to deprive someone of their liberty. The streaming platform can sue him if they like. A civil case that results in punitive damages is also understandable.
In my view, incarceration in this instance is a disgrace. The argument is a moral one, not a legalistic one.
Perhaps the statutes around wire fraud should be reformed. IDK it's not my area, and my argument doesn't rely on a legalistic interpretation, rather it suggests if the law's answer here is to put this person in prison something is wrong with the law. That is the argument. You seem to be asking me how would I codify the solution or else you have misunderstood me.
Your argument: If somebody robs a bank, they did not harm society, the bank can just sue them to recover the money.
Bank robbery typically involves violence or the threat of violence. I don’t think the two are really comparable.
To justify imprisonment (rather than purely monetary penalties or civil judgements) you really have to look at the relative scale of harm and the type of harm inflicted. Imprisonment doesn’t always make sense, there are many nonviolent crimes where a purely monetary penalty would be more appropriate. For one thing, imprisonment can prevent people from paying back the victim.
Not necessarily. One can walk into a bank, slide a note and a bag, and (hopefully) walk out. No threats involved. Still a federal crime.
I feel like you are missing the rather obvious or else the note implies. Luckily the law is not so rigid as to be hamstrung by such sophistry. I didn't assault you, I merely invited your face to make an acquaintance with my fist!
The reason the note works is banks don't want to pay the cost of having their employees getting their brains blown out. Passing a note with this understanding means one knows they are making a threat.
Agreed, and if this didn’t involve the threat of violence then imprisonment wouldn’t necessarily be justified—in other words, if this were the case, it would make sense to change the law to a purely monetary penalty. But of course it is an implicit threat!
No? A bank is a regulated entity in the public interest.
Pointing a gun in someone's face is also not in the public interest.
Juicing some streaming numbers hurt who? Spotify's margin? It's not even clear to me without diving into the actual case where he went from getting an edge to engaging in the alleged crime. Or what he could have done differently to preclude criminal prosecution but could have still resulted in a civil case.
More importantly, why should he have to go to prison? Why don't you make that moral argument instead of engaging in such a misread of my position.
>No? A bank is a regulated entity in the public interest.
What does this even mean? Only crimes against things are "regulated" should be prosecuted? Or "public interest", however vaguely that's defined?
>Juicing some streaming numbers hurt who? Spotify's margin?
Other artists. The subscriber/ad revenues are divided pro-rata (unclear whether it's by subscriber or across all subscribers), so by streaming a bunch of fake music, it's displacing the streaming minutes of other artists, ever so slightly.
Moreover, even if it is spotify that's losing money, how is it less in the "public interest" than banks? For the sake of argument let's subtract the threat of violence, and assume they hacked an ATM or something. Would that suddenly not be in the "public interest" to prosecute the offenders? Why should multi-billion dollar banks deserve more sympathy than multi-billion dollar tech companies, especially for crimes that in all likelihood won't lead to either company's demise?
> What does this even mean?
I take it based on your other comments that the distinction between criminal and civil proceedings is suitably apparent to you?
If so I struggle to understand then why this leap is so hard for you.
You and I can have a private dispute without the government getting involved as a prosecuting party, yes? Banks are highly regulated because the state has sought fit to take an interest in how they are run. Roughly, because if a bank defrauds its numerous depositors this incurs a societal cost. Similarly, violence is also regulated, as it is inimical to the state's requisite monopoly on violence to tolerate private expressions of this power.
I simply do not get the intuition here that it is in the public interest to put this person in prison in the same way the intuition may surface in these other cases. If you disagree that is fine, but then I'm curious to hear where your intuition on this private vs public interest line is. Of course it is somewhat vague. If the public interest was clear and obvious to everyone electoral politics would not exist.
Can you offer a positive moral argument for incarceration in this case? Surely you are aware of principles around the burden of proof? Since you seem to be on the pro criminal prosecution side here why don't you take up the burden of saying you want this man to suffer in prison for his crime? I understand your frustration that I don't have all the answers. It would be a more impressive indictment if I was willing to send people to prison under such circumstances.
I take the burden of depriving a fellow citizen of their liberty in a free society rather seriously.
Do you? If so, please explain to me how you alleviate yourself of this burden in this case. I'm open to being persuaded.
So going back to the ATM hacking example, do you think that's criminal or not? What if it's not a "regulated" institution, like an ordinary business? Say you scam Acme Co out of a few million dollars. Luckily for society, Acme Co is a trillion dollar company, so they could stand to lose that. The only harm is to its margins and shareholders, like you said earlier. Does that mean it's fine to hack Acme Co, worst case scenario I have to repay what I stole, and maybe pay their lawyer/cleanup costs?
If you can't clearly articulate what the "public interest" means, it just feels like this whole thing is just a long winded way for you to say that we shouldn't be prosecuting non-violent crimes, unless the victim is sufficiently sympathetic, in which case we throw the book at them. That's no way to run a justice system.
>Can you offer a positive moral argument for incarceration in this case? Surely you are aware of principles around the burden of proof? Since you seem to be on the pro criminal prosecution side here why don't you take up the burden of saying you want this man to suffer in prison for his crime? I understand your frustration that I don't have all the answers. It would be a more impressive indictment if I was willing to send people to prison under such circumstances.
You can make the same arguments about the questionable utility of incarceration for violent crimes too. The typical arguments against incarceration works equally well for violent crimes as they do for non-violent ones.
Yeah, I think they are arguing that white collar crimes should not result in prison sentences.
They actually don't result in prison (if you are president-elect).
I think you can look at relative impact and decide this. Did the “white collar” crime wreck people’s lives, leaving them destitute? Jail. Did it kill people through negligence, lowering safety standards, or similar? Jail. Did it hurt the bottom line of a large company by 1% or less with no other obvious impact? Maybe they just have to pay it back plus a large, punitive penalty. Maybe they have to do some public service too. But jail doesn’t really make sense. If anything, jail just prevents them from compensating the victim.
Less than 1/10 of restitution is ever paid out. When you send someone to jail, especially for a long time, you’re basically guaranteeing that they aren’t going to make good on any victim compensation.
>Did it hurt the bottom line of a large company by 1% or less with no other obvious impact? Maybe they just have to pay it back plus a large, punitive penalty. Maybe they have to do some public service too. But jail doesn’t really make sense. If anything, jail just prevents them from compensating the victim.
So what does it mean for the movie trope where a hacker steals fractions of cents from everyone's bank account, leading him to get millions in loot? By any meaningful measure that didn't hurt anyone's bottom line, so that ought to be fine, right? Even if you think this is somehow okay, what about the "death by a thousands cuts" problem, where a trillion dollar company gets scammed 1000 times, which becomes a deleterious amount? Do you have to prosecute people at some point? How would that work?
Sounds like a great case for restitution, penalty, and community service, like I described in the post you literally just replied to.
This wasn't a dispute though. This was clearly fraud, and I think it becomes criminal due to wire fraud (fraud crossing state or national borders).
To me, this falls under the category of white collar crime. I'm OK with white collar criminals serving time. It's not like this case is in a gray area. It's clearly a conspiracy to commit fraud on a large scale.
I get where you're coming from. It's not stealing. But, setting up fake accounts in order to trick Spotify into sending him money is clearly fraud.
> Juicing some streaming numbers hurt who? Spotify's margin?
You don't seem to understand how the streaming revenue model works, and why this is an egregious fraud against the public interest. You believe that stream fraud is someone simply stealing from Spotify/YouTube/etc, so who cares.
In reality, all musicians share a pool of revenue across ads + subscriptions on each platform (typically two-thirds of the total, although each platform has a different rev share model).
This fraud only marginally impacts Spotify financials, as their cut is fixed and taken from the topline [1]. But someone abusing the system like this guy breaks the model for everyone. Not only you're stealing money from millions of musicians, but you're undermining the confidence in the whole industry.
I don't have an opinion if this merits jail time or not, but yes, this is pretty bad. Like money counterfeiting-bad.
[1] ps: of course, if this becomes rampant, musicians get screwed and turn against Spotify, so it's in their best interest to do whatever it take down the fraudsters. It's a never-ending cat-and-mouse game.
As already discussed in other places in this article Spotify chose this model and could well choose one that cannot be abused this way. Why does it need protection by the criminal justice system.
What does it have to do with the crime at hand? Spotify is not asking for special protection. Someone defrauded thousands of musicians; it's the justice's job to step in and ensure markets operate fairly. This is working as intended.
Also, this is not (just) about Spotify; all streaming platforms have some sort of subscription and/or ad revshare, and were abused by the same fraudster.
Per the original case: "Music can be streamed through platforms such as Amazon Music, Apple Music, Spotify, and YouTube Music... SMITH created thousands of fraudulent accounts on the Streaming Platforms that he could use to stream songs".
> Juicing some streaming numbers hurt who?
He used fraud to get a payout from Spotify. It's analogous to forging a check to get the bank to pay you money which you aren't owed.
That doesn't sound like something that should cause someone to be locked away either. Prison should be reserved for people who are too dangerous to be living among the rest of us, along with short jail times when needed to prevent people from fleeing prior to their day in court when the risk of that happening is high enough.
Justice is supposed to make sense for society not for the uber wealthy. No prison sentence.
It's true that the state has discretion on whether to pursue a crime, and this is apparently true for harder crimes like murder.
I guess the state prosecution just disagreed on this matter, I'm assuming that, within their specialty, they take the top N cases and dismiss the other pettier cases, and in this case this case made the cut according to the workload capacity of the fraud prosecution workforce.
In raw stolen amounts, it's not small at all, it's like 8 million dollars, which is an amount that can be argued to be worth one or two lives, it may be the cost of complex surgeries and health insurance, or the cost for good nutrition, living space, so it could be argued that this person is taking those resources away from someone else, no matter how inert or ridiculous the means by which they stole that money may be. If someone defrauds 500 million dollars by impersonating a clown, the optics of defrauding 500 million should prevail over the optics of "putting someone in jail for being a clown".
Did you miss the fact that the accounts he was streaming on were bot accounts created with stolen debit cards?
This was essentially money-laundering at scale.
Are you fine with paying $50,000 a year to separate this person from society because he cheated some company? Are we really taking corporate personhood in this direction now?
I don’t believe that people running this kind of scam are engaging in careful moral reasoning about acceptable victims. The man who did this would surely have stolen $50,000 from my grandma if he thought he saw a clever way to get away with it.
Arguably he reduced the payout of real musicians by doing this, so he did harm real people too.
Careful with that line of reasoning though because artists have been hurt by spotify more than they were hurt by this guy.
https://www.musicbusinessworldwide.com/spotify-denies-its-pl...
https://www.musicbusinessworldwide.com/remember-spotify-fake...
You don't have to go that far for bad stuff Spotifys done - at minimum they used pirated libraries back at their start, etc, and they've overall contributed to less payouts for artists. Kind of the Uber of music.
It matters who you're stealing from. And if you're undermining the system itself. This is why counterfeiting currency is considered such a serious crime. If I photocopy a $1 bill, I get, what, $1 for free? That's not that big a deal. But because having fake currency in circulation undermines the entire system, and thus makes for serious crime, so, too, does having fake listeners and getting rich of the royalties. Who cares if Spotify's CEO can't get buy forest in Sweden, in duping the system, it undermines the drive for real actual human people to create music that other actual human people want to listen to. That there are other injustices on the world doesn't undermine this injustice being addressed.
I simply don't buy that this is like copying a $1 bill.
And I don't think you do either. I think one could construct a suitably objective test that would relegate certain instances of this sort of fraud to the civil courts where I think they belong.
Part of the problem is conflating the private Spotify ecosystem with "the system" writ large. In any event, a civil case with appropriate punishment would serve to dissuade others from taking the same action.
What does adding a prison sentence accomplish?
It's like copying a $1 bill eight million times.
I can’t really decide. Punishments for crimes need to be enough to prevent people from doing them. Guy made millions of dollars fraudulently, what’s an acceptable punishment if it’s not jail time?
Same thing with big companies. They knowingly break the law because the punishment is less than what they gain from it. There’s no incentive not to break the law at that point.
A fine of an equal amount + s&p gains on that amount over that period of time. This is not a person who has indicated they would physically be unsafe in society. Many people don’t have the opportunity to lie at that level, but would, are they dangerous and in hiding?
So the worst case for stealing is… returning what you stole…?
I mean, returning what you stole, surrendering the gains you made from what you stole, and covering the gap of the person you stole from seems pretty reasonable? Like, they were made whole. It's a net loss to the thief.
Prison for theft is so brutally cruel. Who was really harmed by this once he paid the money back? A line item in some megacorp that was lower for awhile?
No one felt anxiety or pain, the megacorp probably barely noticed. Pay them back with interest, move on.
Obviously the calculus changes for violent thefts, or breaking into someone's home. Those cause real emotional impacts to people. Of course simply returning those items doesn't make someone whole.
If they spent a good chunk of it at the time and you don't let them discharge that fine in bankruptcy, isn't that basically a sentence to a life of poverty to pay back the $X million owed? Median US income is about 90k, let's say that left him owing 4M (less than half of 8M + interest), that's 44 years to pay back 4M even if the entirety of your salary was going to it.
Is "forfeit what you've got and go to jail for 18 months" harsher than that? I'd pick the one that let me get a clean start after.
And in the case that it wasn't spent, and by fine you mean as a replacement for any forfeiture, not in addition, then sibling comment has a great point that "if you get caught, you just gotta give it back" is an incentive to commit fraud, not one against committing fraud.
Yeah I could see making him give the money back but jail seems like too much.
If the penalty for large financial crimes is simply not getting to keep the money then there is no legal deterrent to committing such crimes.
Using the fraudulently obtained debit cards should be a prison sentence. That's real money, from real people.
Don't focus on the streaming revenue angle. Focus on the fact that this was a giant money-laundering exercise, allowing him to turn stolen debit cards into real money.
This is just totally made up. The indictment says he paid for the debit cards. There's no allegation that it was stolen.
I don't know that you can make a strong case that the US over-punishes white-collar/economic crime. This isn't drug crime. The average full-of-shit-founder-or-CEO isn't getting locked up. Perhaps the US would be better off with more enforcement of large-scale economic fraud and less of petty drug possession and sales. Put some teeth into due diligence and see if peoples' investments improve.
> None of this merits a prison sentence to me.
They stope millions of dollars through fraud and deception.
That absolutely deserves a prison sentence
If he has access to super intelligence, he shouldn’t need to scam those poor corporations.
I find this fascinating, actually. On one hand we must disincentivize fraud. On the other hand enforcement of laws really should have observable utility and not feel arbitrary. I’m much more on the “fix the model” side of the spectrum on this one. That doesn’t mean I think we should allow what SMITH did.
I feel uncomfortable when we start handing out prison for things that are isomorphic in utility to things that seem clearly legal.
Which of these are fraud:
a) I block or skip ads in media I consume
b) 1000 people block or skip ads in media they consume
c) I convince 1000 humans to play my songs every day and all of them listen to the ads
d) I convince 1000 of humans to play my songs every day and all of them skip the ads
e) I program 1000 bots to play my songs every day
(b) (d) and (e) all have the same outcome for ad agencies, nobody hears the ads. If (e) is the only one that’s problematic, then we aren’t solving the problem by prosecuting (e).
Similar vein to Matt Levine’s “everything is securities fraud” takes.
IANAL, but...
>a) I block or skip ads in media I consume
>b) 1000 people block or skip ads in media they consume
Not doing something is generally considered okay, even if it decreases someone else's revenue. eg. saying that a given product is a scam and not worth the money (assuming it's true). Same with skipping ads (eg. TiVo)
>c) I convince 1000 humans to play my songs every day and all of them listen to the ads
>d) I convince 1000 of humans to play my songs every day and all of them skip the ads
Legal, because the whole point of advertising is to convince people to do something, even if it costs someone else money (eg. drugs, which might cost your insurance provider money). Where you might get into trouble is if the actions turn out to be fraud, eg. telling people to stream music, even though no one's listening to it, for the sole purpose of getting streaming minutes, or setting up a kickback scheme (might be tortious interference). Again, going back to the drug example, it's pretty intuitive. Advertising a drug? That's fine. Telling people to buy your drug, just so they can chuck it into the trash, for the sole purpose of enriching yourself? Probably illegal.
> telling people to stream music, even though no one's listening to it, for the sole purpose of getting streaming minutes
How is that fundamentally different from netflix or youtube auto-playing something after a video finishes, knowing that a large percentage of the people who started the first video won't be present or attentive to the second, in order to artificially inflate views for the content they're promoting.
1. the auto-play does eventually stop, presumably because they need to maintain some semblance of legitimacy to advertisers
2. caveat emptor. how youtube works and how ads are played is hardly secret information, so accusations that google is deceiving advertisers (not just providing a subpar product) is hard to make.
3. people have tried suing companies for this, but they were over securities fraud rather than deceiving ad buyers. No idea how successful they were though. it's worth noting that suing for securities fraud is easier because unlike with advertising, you have to declare risk factors, hence why every company's prospectus lists all potential list factors under the sun.
Intent is fundamental to all criminal cases
The intent of auto play on YouTube is not to defraud ad agencies
What is the full intention of enabling autoplay by default?
To keep the user engaged since "doing nothing" is the default action for people
I wasn’t detailed enough. What I was actually curious about is whether it mattered that bots were used.
d.1) convince humans and they use their main account
d.2) convince humans and they use and alt account
I think the resolution to my question is: it’s still fraud if humans do it, like you said. And it makes me wonder if more things should be considered fraud like paying people with free products for Amazon reviews or purchasing GH stars.
Easy, (e) is fraud. The rest are legal. You can choose to not do something, advertising is analogous to convincing and advertising is legal.
Collecting money from a platform by making bots play songs you created is fraud.
Making bots listen to a song without any financial incentive is not fraud.
So how come Sam Altman & friends aren't in jail yet, but Aaron Swartz was facing life-ruining charges?
If creating bots and mass-violating ToSes for financial gain is fraud while doing bot stuff for fun is totally fine, then clearly the AI companies should be treated like giant criminal cartels, should they not?
> So how come Sam Altman & friends aren't in jail yet, but Aaron Swartz was facing life-ruining charges?
Aaron was threatening power structures, not enriching them.
the difference is that (d) is not fraud and (e) is fraud, lol. Duh.
you seem to be thinking of the legal system like some kind of programming language / logic paradigm and it is not that and never has been
most likely ad-blocking would also be considered some sort of fraud (or rather: companies would block using their services if the ads were not seen, and then circumventing that would be regarded as fraud) except that it is not politically/socially tenable to do that at all.
It’s rhetorical. Setting aside the obvious credit card fraud because I didn’t know that was a factor when initially asking the question, no it’s not clear to me that using bot accounts to consume a digital streaming service is fraudulent or morally wrong the same way assuming a fake name to use someone else’s credit card is.
I don’t care if a service seeks civil remedy for any damages due to a breach of contract.
I also don’t fancy a future where people have to be worried about criminal penalties for spinning up a bunch of agents to automate something that enriches them.
Is buying likes and gh stars fraud? Is it okay if humans click the star button? Is it okay if a large distributed workload does it?
Anyway my actual stance is that it looks like in this case it’s not the bots that are the key focus of this matter so my earlier comment is mostly just a digression. And that I’d hope this case would be ruled similarly if for example human users were paid to stream his songs, however that would be adjudicated.
> Is buying likes and gh stars fraud?
Maybe not legally, but morally... yeah? It's definitely gross, in the sense that I would like to see it eradicated as a system.
"Cheating" systems benefits people in the short term but corrupts the, like, fabric of society in the long term ... when cheating is normalized and you have to cheat to get ahead then everything kinda vaguely sucks all the time. People often end up in a posture vis-á-vis big corporations where it feels like cheating them is morally okay because the corporations are cheating in a systemic way, or otherwise don't deserve moral recognition because they're too diffuse and machine-like... I empathize with that. But we shouldn't turn around and therefore _not_ interpret the cheating as cheating. It's still bad. But if you do it "at scale" and make a business model out of it and then get caught... well you're an idiot. I agree that it feels weird that this was a prison sentence instead of a big fine. I imagine it's a question of magnitude: it was more than skimming off a profit, it was basically at the scale of 'criminal enterprise' and we ... don't like those.
> I also don’t fancy a future where people have to be worried about criminal penalties for spinning up a bunch of agents to automate something that enriches them.
It's obviously a question of what you have the agents doing.
> And that I’d hope this case would be ruled similarly if for example human users were paid to stream his songs, however that would be adjudicated.
I agree.
The nuance is financial extraction coupled with deceit.
If your scheme doesn't extract value, nor costs anything to other parties, there is no victims, you can get away with it. Even if policies say no. The risk is termination of service.
Skipping ads is a loss of opportunity for advertisers. But they don't get extracted money. They may not like it, but they can continue to fish elsewhere and aren't being siphoned because you skip their ads.
If you spawn websites and farm fake viewers to scam ad networks, you are engaged in criminal activity. Not because you fake viewing ads. But because you extracted a profit of this activity which was extracted from another party (via deceits).
Isn't the nuance mostly or only the fraudulently obtained debit cards?
I suspect the case hinged on that, and everything else was legal, albeit part of the fraud, and was included as a complete description of the scheme.
To be fair, I'm guessing he couldn't have created the scale of fake accounts without debit card fraud, but creating multiple accounts, even if they're fake, is usually just a TOS violation, or maybe a civil matter, not criminal.
Could be a separate charge, I agree that's an even clearer cut.
But I was responding to the comment touching on more general seemingly ambiguous situations.
What makes Terms of Service / contract violations a different case than deceit for financial profit. Why is one tolerated by justice but the other condemned as criminal activity.
But you are right, debit card fraud, wire fraud and the likes are clearly defined as criminal.
> but creating multiple accounts, even if they're fake, is usually just a TOS violation, or maybe a civil matter, not criminal.
Yes, in and of itself, creating multiple accounts in violation of TOS is probably not a criminal fraud under either state or federal law.
But when you do it as the mechanism to conceal streaming manipulation in violation of the agreement that governs the terms of payment, and thereby to secure large amounts of money from the streaming service under false pretenses (and, given the structure of streaming payments, to deny payment to other song owners which they would have received without the deception) on the other hand is a different story.
Like yeah, flexing your index finger isn’t a crime, either, but if you are holding a gun with that finger on the trigger and the barrel pointed at someone's head...
The law very often is focussed more than anything about the purpose and effect of an action, and that you can ignore that and describe the action in terms that aren't criminal without considering purpose and effect really doesn't matter.
The fraudulent debit cards are definitely criminal.
Using bots to automate listening to his own songs was likely fraudulent too because he was being awarded royalties. If his songs had been monetized in some other way I'm not sure what he did would be fraud.
I don't think creating multiple accounts is, even if it's in violation of the TOS.
If that was the case, anyone who signs up for multiple accounts on a website/app to get multiple coupons/bonuses/etc... would be committing fraud.
None of this is close to firing a gun pointed at someone's head.
They very clearly made an example of him given the sentencing, but I don't think they were confident about all the charges in the indictment based on the plea agreement and the crazy high succuss rates in federal criminal cases.
> If that was the case, anyone who signs up for multiple accounts on a website/app to get multiple coupons/bonuses/etc... would be committing fraud.
That seems to me like it would be easy to prove it is fraud in a US court.
I don’t think fraud requires enrichment, does it? I know we commonly associate the two but it’s somewhat of an annoyance IMO that we only care about scheming material misrepresentation when it involve money.
Edit: interesting it does look like there must be an object of the fraud, likely to prevent the law from being used broadly to punish lying.
That sounds right. I believe it's similar to beach of contact requiring some sort of damage in addition to the breach.
Is it fraud for me to spawn a bunch of bots to listen to YOUR music? In fact, this has happened before, and people who are not involved at all get punished for the fraud that they didn’t commit. So it’s a quite tricky problem, and I agree that it just isn’t that straightforward.
This is a thing. You want to hurt someone's business? Buy a bot farm to engage in obvious click fraud on their account. Google or whoever will assume it's them doing it and shut them down, drop them or punish them otherwise. It's like a false flag operation. A superficial investigation will point to "who benefits? well it's clear who's doing this".
>a) I block or skip ads in media I consume
Skip is fine. Blocking with third party tools is a breach of contract as a consumer, but not fraud nor a crime.
>b) 1000 people block or skip ads in media they consume.
If they individually decide to do this, then it's 1000 times fine or 1000 instances of breach of contract. If they get together and do this collectively, or are instructed to do so by one person, it starts to encroach on civil conspiracy.
>c) I convince 1000 humans to play my songs every day and all of them listen to the ads
If you convince them to play the songs on the basis of the music, that's the very object of the contract.
If you convince them to do so on the basis of the ads, presumably you incentivize them with money if they listen to the song, then it's fraud. It's arguable of course, but if you are paying the listeners, then it obviously makes the value of the ads 0, you are knowingly selling something that has 0 value and charging a comission for that sale.
>d) I convince 1000 humans to play my songs every day and all of them to skip the ads
d) This is weird because your revenue would be 0 in this case. But arguably you would be benefitting from the service of music distribution without paying for it with the cost of serving ads along your music. It's a completely different situation than the one in the OP, it's more like piracy, less like fraud.
Again if by skip you mean a service provider interface, then that's fine, I'm assuming you mean block with ublock or some third party reverse engineered thing that's forbidden by ToS.
>e) I program 1000 bots to play my songs every day
e) Of course this is fraud, I think it's obvious to you and you are just positing this as part of the obvious end of the slippery slope, so it's not worth explaining why. But just as a teaser, it involves agreeing and breaching 1000 contracts and creating 1000 fake identities, so identity fraud at least!
>(b) (d) and (e) all have the same outcome for ad agencies, nobody hears the ads. If (e) is the only one that’s problematic, then we aren’t solving the problem by prosecuting (e).
Regardless of the specific case, in general there's many cases where regulation attacks only some scenarios which cause a damage, and that's fine. For example drunk driving, driving too fast, and blinking at the wrong moment all might have the same consequence, but we only regulate the first and the second.
>Similar vein to Matt Levine’s “everything is securities fraud” takes.
Haven't read that, but this is strictly not securities fraud, just fraud.
Yes the list is rhetorical. Yes I am aware this isn’t securities fraud.
Personally, I am not sure I consider pointing a bot at a service to use it, even if it enriches you, generally to be evil or fraud. I think now more than ever the concept of a bot is almost meaningless. So my angle with the comment is to talk about the spectrum and understand why people so clearly see (e) as criminal relative to the other situations when the harm or effective outcome is the same.
We seem generally okay with deception until it is used for personal enrichment. Why is that?
>Personally, I am not sure I consider pointing a bot at a service to use it, even if it enriches you, generally to be evil or fraud. I think now more than ever the concept of a bot is almost meaningless.
I think I said this already, but in the cases of contracts and breach, it's a matter of perspective to interpret whether the gains being defrauded are gaining the consideration of the victim, or in keeping the consideration of the perpetrator, and what you are doing is taking the most charitable of the interpretations, when I think it's very obvious that of both interpretations, the most damaging should be considered.
Example, a rare baseball card is sold for 50M dollars, the 50M dollars are never wired, you would argue that it's just a stupid baseball card, when I think we should consider that 5M were stolen. The inverse scenario would be the same thing, if the 50M are wired, but the perpetrator keeps the baseball card, you would argue that it's just a baseball card, but I would say that it's fraud for 50M.
Market value is often considered, in which case it depends on third party estimations as for the true value of the thing. Which in the case of the streaming service, I don't think there's an overpricing here at all. 80M fake plays at 8M USD is like 10 cents per ad, maybe you can argue that it really was 1 cent per ad and the sentence should be lower at 800k? But it's a very weak position to argue on subjective grounds that the asset being traded is morally not something that people should be going to jail for. It would require every trial to judge not only the contract and the facts of the case but what the object of the contract was and whether it is 'serious' enough, effectively carving out some assets as 'serious' like food and oil, while others are unserious and subject to fraud, like music and software. You are effectively arguing against our trade in a way by devaluing intangible assets whose value and contracts we rely on to make a living.
No that’s not my argument actually. I don’t think theft here is justified just because it’s a streaming service or big ad or it’s just a click. There’s a real crime here.
I am uncomfortable with the idea that something that is allowed if you pay humans is also illegal if you use bots. That feels like it deserves more discussion. And it feels like while there is a clear crime here, it’s also a problem that the ad and streaming industry have a model that reduces one stream to one human. I don’t want to worry about jail time for automating tasks with bots and accidentally falling on the wrong side of some industry’s really bad/dated monetization model and having it look like fraud. That isn’t the case here, but it encroaches.
"Money going to one person through deceit that would've otherwise gone to others" has a pretty material utility impact on the "others," even if they're a large aggregate or if they're corporate interests/investors who "have enough money."
I lean fairly redistributive but through consensus and governance, not through fraud.
It’s not about redistribution for me. I’m not of the mind “fuck big advertising and streaming any theft from them is justified”.
It was more about making sure we don’t punish people for something that would otherwise be legal if they paid humans to do it but instead used bots. And it doesn’t seem like that was the case here after more discussion panned out.
And also that we don’t ignore the minor but still real part of this that’s due to a really poor assumption that “one stream == one human”.
(e) is the one that’s illegal
Why do you pretend that humans are equivalent to bots?
And if you think skipping ads means the advertising agency gets screwed you are kind of showing ignorance...
I close my eyes and hit the mute button. I probably deserve the death penalty.
It's not as hard as you make it out to be.
Advertisers are fine with paying for ads even of some users turn the volume down when they come on. They are absolutely not fine with paying for ads streamed out into nothingness.
One is a problem for the industry. The other is not.
>To obtain the necessary number of songs for his scheme to succeed, SMITH turned to super intelligence, which he used to create hundreds of thousands of AI-generated songs for which he could manipulate the streams.
He turned to what, exactly, Donnie?
> superintelligence
> AI
Same sentence even lmao
ahhaha yes! I didn't even catch that because I was so focused on SUPER INTELLIGENCE! :@
Is every retarded influencer botting their view counts to spread antisocial content in exchange for money liable like this?
If so, I think we can save America.
> ...which were generally created using super intelligence...
> ... SMITH turned to super intelligence...
Holy shit, we've got ASI?
Where do I go to invest all the money I have in this breakthrough!
This is a government renaming directive. Similar to how DoDefense is renamed to DoWar, or Gulf of Mexico is renamed to Gulf of America.
It was made up one day and that's what govt publications must call it now.
> Where do I go to invest all the money I have in this breakthrough!
You get it.
I knew it was something dumb, I just had no idea it was dumb at that scale.
The best part about all the insistence about it being the Department of War, is that Hegseth is still the secretary of defense
The original purpose of the org was also explicitly defensive, with failing to prevent Pearl Harbor being an explicit influence for improving communication and cooperation between arms of the military through a combined leadership.
It's like recursively, fractally stupid.
Until Congress acts, it's still the DoD.
"which were generally created using super intelligence"
What the... OK, I had to check if that language was in the indictment. It's not - https://www.justice.gov/usao-sdny/media/1366241/dl uses artificial intelligence. It's the press release from the Justice Department dated 6th of October that uses "super intelligence": https://www.justice.gov/usao-sdny/pr/north-carolina-man-sent...
Amusingly (and unsurprisingly) their earlier press release dated March 19th calls it "artificial intelligence": https://www.justice.gov/usao-sdny/pr/north-carolina-man-plea...
Trump decided to rebrand it as Super Intelligence since AI is so politically divisive.
I'm sure he was thinking about the divisiveness of the term 'AI' and not the millions of dollars AI companies have given him or the massive amounts of money he and his family hold in investments in AI data centers.
Greg Brockman's $25m apparently bought him the need to rename OpenAI entirely.
Yes nothing politically divisive about renaming a common term and calling people who don’t use the new term THE ENEMY.
"Can we find an even-more Matrix/Terminator-sounding name??"
I wouldn't be surprised if it was industry-pushed to try to get people used to the idea of "don't question the machine, let us replace you." Are you "super", after all?
Will AGI be Ultra?
Intel and Nvidia drove SGI out of business. Will SGI drive Intel and Nvidia out of business?
This is the world we live in https://www.politico.com/news/2026/10/08/trump-ai-super-inte...
If I saw that and hadn't verified that was real for myself I would have thought that it was satire.
Considering the White House's market-manipulation and unprecedented insider stock trading in the last year, I would not be surprised if it's part of another corrupt scheme.
For example, pump-and-dumping .si domain names or some other asset which connects to the phrase/acronym.
Nancy Pelosi isn’t in the White House?
I find the domain name theory funny/sad and par for the course, but it does seem like an awfully inefficient method of corruption compared to what shitler and his pals have been up to so far, no?
Like going from very successfully robbing banks to robbing convenience stores?
Seems more like a loyalty test to me.
It's absolutely that.
In his speech about it at the UN: "Let's see if I have any power. Maybe I do, and maybe I don't. We're gonna find out pretty soon".
It's a "kiss the ring" / fealty thing.
I have always been surprised by the pettiness and vulgarity of corruption. Sometimes Trump tries to steal $10,000,000,000 from the IRS, but sometimes he hawks branded Bibles for $59.99. I don't understand why someone with more money than he could spend in a dozen lifetimes regularly humiliates himself for a few grand.
Once you have a certain amount of money it’s a sickness to just want more.
It doesn’t matter if it’s $10B or $59, more is more
The answer might be that he’s actually far less successful than he claims.
That’s the reason why he won’t let anyone see his tax returns.
He shutdown his court case against the BBC rather than open the books to the lawyers.
This is a bloke that failed at running casinos. A business where suckers just hand you their money. And he failed.
He just “ain’t right good” at business but has the ego of The Big Lebowski.
Completely agree about his business ventures and entire career. But his presidential grifts, and those of his family, do look highly effective and successful. Compared to those, a domain name pump-and-dump seems outright pathetically inefficient.
> pump-and-dumping .si domain names
That's literally what happened. Thousands of .si domains were bought up before his renaming, and then offered up for millions.
PS: His wife is from Slovenia. I'm sure that's a coincidence...
It's also just a coincidence that his kids, who have no background in technology and no knowledge of programming or cryptography have a crypto coin company that sells, nothing of value, with, basically 0 advertising, and makes billions of dollars, mostly from deals with Gulf Arab dictators, who then get favorable deals with their dad ...
I had to look it up but you are right: https://en.wikipedia.org/wiki/World_Liberty_Financial
Laws really are just as effective as boo-boo band-aids aren't they?
A plead to Slovenian registrars: add a condition that says the annual fee for .si domains doubles every time the owner uses the phrase "superior intelligence".
When I clicked on this link, I had to triple check that it was the real Politico website. What interesting times we have the joy of living in…
One of the talking heads was pointing that the AI has emphasis on "artificial" - created by humans - whereis super intelligence brings up the idea of something super/above to humans, and that among others has the political dimension of democracy - power of the people - vs. dictatorship - power over people.
"which he used to create hundreds of thousands of AI-generated songs"
SI-generated songs. [Now trump is angry](https://www.businessinsider.com/trump-super-intelligence-reb...)
Careful, promoting thoughtcrime by malquoting Miniluv based on old documents that have not been rectified by Minitrue with the latest updates to newspeak could land you in a joycamp.
I mean paying for water, do you expect this to be drinkable or is that ad fraud? (I'm referencing a supreme court judgment here).
No says the man in washington, listening to your own song 10000 times simultaneously is "fraud"
no gods or kings, only man!
> fake email accounts
What's a "fake" email account? According to the law, that is. Does that mean that having more than one (let's say) email account might now be considered as "fake", and hence potentially illegal?
> What crime did he actually commit?
Fraud. https://xkcd.com/1494/
Generating the AI music wasn't illegal. Using bots to inflate /listens/ of an AI-generated song probably is against a platform's TOS, but isn't inherently illegal.
However, using bots to collect royalties on the songs generated definitely fits within the definition of wire fraud as he was using electronic communications (i.e., the internet), to carry out a scheme to defraud streaming services of money.
From the statement: At times SMITH was using as many as 10,000 Bot Accounts at once to fraudulently stream music, and he used fake email accounts and fraudulently-obtained debit cards to create the Bot Accounts.
So the bots he actually used were most likely illegal (though it's true other bots might not be).
Using bots to defraud the platforms and get royalties he didn’t actually earn sounds like a crime to me, but what do I know. Maybe I should just make a Trump joke.
The crime is fraud, and if he was using the service as offered he wouldn't have thousands of accounts pretending to be different people.
Are any major corporations doing something similar to this, play-botting to get other people's royalty money?
Wasn't Brave browser caught replacing ads with its own? And the Honey extension replacing / injecting referral codes?
> And the Honey extension replacing / injecting referral codes?
Fraud in larger scale and using other people's computers.
Was it ever prosecuted with the same vigour?
It's a corporation so I'm gonna bet no.
> Was it ever prosecuted with the same vigour?
A class-action lawsuit is "still being fought at the pleading stage" [1]. The way this often goes is prosecutors will watch the discovery in that case to decide if anyone committed a crime.
[1] https://openclassactions.com/lawsuits/paypal-honey-affiliate...
So there was no criminal prosecution, just a lawsuit.
> way this often goes is prosecutors will watch the discovery
>> there was no criminal prosecution, just a lawsuit
Like, come on. (This reminds me of the folks on HN confidently concluding Elizabeth Holmes wouldn’t see the inside of a jail all the way through sentencing.)
I can't speak to the Brave thing, but the Honey thing is another example of fraud, yes.
> It turns out that now, if you take advantage of the system as it was designed and gain a financial edge, you become a criminal
Yes, exactly. Traditionally, fraud consists of lying to obtain something you wouldn't have gotten otherwise. This seems sensible, right?
But corpos have figured out how to abuse this - create a long list of business-method-desires in their "terms of service" (aka the legalese diarrhea that nobody reads). The corpos then take the position that merely by using their service as presented, users have take on responsibility for representing that they will abide by the listed whims. When it turns out that users' interests differ from the corpo's whims, and a user does something they majorly don't like, they cry fraud.
In the past, this was limited by the facts that 1. legalese diarrhea wasn't really involved in day to day transactions (we relied on legislative law made by public bodies rather than private law unilaterally promulgated by corpos) and 2. when you bought something, the seller's control over it simply ended. Both of those assumptions have been blown away by pervasive communications, and we really need some reform here.
> isn’t the United States a free market
No, far from it. A free market doesn’t have regulations, subsidies, tax incentives, bailouts, etc.
The 'free' in free markets is a spectrum. A market without anyone enforcing limits will just coalesce to a couple large player(s), and won't remain free for long.
I think that's just called anarchy.
from the article, the crime was that he thought about using a payment system to transfer misrepresented income
> SMITH pled guilty to one count of conspiracy to commit wire fraud
the department of justice made a sophisticated music-themed plot around it because the only crime they had was too dumb
> if you take advantage of the system as it was designed and gain a financial edge, you become a criminal—but if a major corporation does it, they just get a slap on the wrist.
You don't even need to be a major corporation to get away with it. You can be an individual if you have the right connections.
I believe what this guy did with the music streaming was wrong. But I also think whatever punishment he gets should be shared by someone who, say, lies about their 500 active user worthless company to unload it for tens of millions of dollars.
But one of these people is going to jail for a year and a half and one is preparing to launch a trillion+ dollar IPO.
Likely a ToS violation. But is this enough for a crime?
"“Michael Smith exploited super intelligence technology to generate a fraud,” said US Attorney Jamie McDonald. “By flooding music streaming platforms with automated bots in the place of consumers, and fake songs in the place of creativity, Smith robbed millions in royalty payments from genuine artists and their fans."
This state attorney does not seem to be the sharpest tool in the box or I don't get it.
1. I don't see any possible way how he could have stolen from the fans of the artists.
2. If he stole from the artists, then this must be a fixed amount of money in the pot and the slice of the piece of the cake gets smaller, if more people withdraw. There might be such an arrangement between artists and the streaming provider but I don't know details.
Literally the next full paragraph after your quote:
“Royalty payments are made proportionately to musicians and songwriters from a pool of funds. As a result, streaming fraud diverts funds from musicians and songwriters whose songs were legitimately streamed by real consumers to those who use automation to falsely create the appearance of legitimate streaming.”
I don’t think the issue is the fact that the songs were AI generated as much as it is he faked tens of thousands of customers (presumably in free tiers) streaming the songs that he owned in order to collect royalties. That does indeed sound like garden variety fraud to me.
If you and I have a contract that I’ll pay you for unique shoppers referred to my store and you just go in yourself to trigger the door counter 10,000 times wearing different disguises, it’s pretty clear that you have defrauded me.
> he used fake email accounts and fraudulently-obtained debit cards to create the Bot Accounts
If you ignore the keyword optimizing buzz-catcher press release, thats the crime right there. He used stolen debit card numbers to sign up accounts.
Just totally fabricated. The indictment does not say the debit cards were stolen, it says he paid the issuer for them.
Fraud isn't a new concept.
Fraud: lying in the inducement or fulfilment of a contract.
If lying to induce or fulfil a contract were not a crime, someone could sell you a car telling you it has 0km, but it's actually 300km. Or they could sell you a hamburger telling you its made of meat, and it's actually made of soy. Etc..
Selling a song with 100M listens is a lie if you faked those 100M listens, it's not very different from stealing (but it is different)
> What crime did he actually commit?
Fraud
I'm reminded of the words of "Smokey" Yunick who said "I never cheated a day in my life. I just read the rules better than the people who wrote them."
That is what I see with this case. Aside from the debit card thing I am not certain any laws were broken. If making "bots and socks" to manipulate for profit is illegal there is a lot more areas that I would love to see them gone from.
This is a common mistake technical people make when discussing legal topics: they look for technical compliance. I can see why. You try and prove that code works. You think about invariants, preconditions and postconditions.
The law doesn't work that way. So much of the law comes down to holistic and subjective tests. It looks at the totality of the evidence. Those tests typically also contain questions that are also tests.
Let me give you an example: the FBI gets access to a site hosting CSAM and, in doing so, they get IP logs. Many of those logs point to US IP addresses. From this they make arrests and prosecutions.
The typical engineer defense is "you can't prove that use of my IP was me", like you could've been hacked. While that's technically true, the law doesn't work on absolute certainty. Investigators and prosecutors will do things like figure out if you were home at the time, if there's any corroborating evidence on any of your devices and so on.
So back to streaming, you look at the totality of the accused's actions. Did he get mass copies of copyrighted music? As BS as IP is (IMHO), stealing it is still a crime. Using services within their ToS isn't a defense. And the fact that you committed a crime probably means you violated the ToS anyway. Dig in there and you'll probably find stuff about not doing things that aren't illegal.
NAL. My guess is it's debit card fraud plus everything else.
If the debit card fraud wasn't present, and it was instead a group of individuals doing this, I'm not sure if it would end up in criminal court. It could still end up in civil court.
They got him on wire fraud. Everytime a case has a shaky legal basis, they go for wire fraud. The legalese is stupidly broad, encompassing, and comes with huge penalties. [1] Up to 20 years in prison for any scheme to defraud that uses practically any digital tech at any point. It probably made sense in the 50s when wire fraud would have been quite a specific sort of crime, but in the era of the internet - now basically anything and everything can be construed to be wire fraud.
In Kelly vs US [1] a couple of politicians were convicted of wire fraud for closing certain lanes to create a traffic jam for political benefit. It was overturned by the Supreme Court but that gets into interpretive arguments of what the statute means when it says "OR". The law isn't like code. Anyhow, yeah the wire fraud statute really needs to be rewritten or broken down into more appropriate and targeted statutes. But that will never happen because it's a superweapon in its current state.
[1] - https://www.law.cornell.edu/uscode/text/18/1343
[2] - https://en.wikipedia.org/wiki/Kelly_v._United_States
I mean substantively this seems like just fraud based on what I read. He defrauded Spotify of $8m in ads with bots
The problem here is that basically everything is wire fraud. For instance if you wrote a lie to me on these forums with the intent to somehow enrich yourself, that could viably be seen as felony wire fraud - with up to 20 years in prison. Exaggerated credentials on a CV you sent by email? Wire fraud. Emailing in for sick leave when you're not? Wire fraud. Most of us have committed wire fraud, probably multiple times, throughout our lives. Obviously you're not going to be charge with wire fraud for those sort of things in practice, at least not unless the government wants to nail you. And I think that nuance of them just being able to tack on heavy charges at their discretion is quite undesirable.
That's not to say we should encourage lying or botting or whatever else, but they need their own statutes as opposed to a 50s era law which has turned into a catch-all superlaw with really harsh penalties. So in this case exactly what was the crime committed? Terms of service violations aren't illegal, neither is lying to or exploiting companies, neither is running bots. Wire fraud is dragged out exactly in circumstances like this when the government wants a conviction but it's not clear what law was broken, because even if no law was broken, they probably committed wire fraud, because everything is wire fraud.
It's also a highly asymmetric law. For instance Sony famously got the No Man's Sky (video game) people to lie through their teeth about what the game was going to include. They made countless millions of dollars from these lies. That's 100% wire fraud, but because they're a giant company lying and exploiting people 'by wire' is just standard operating procedure, and they didn't even get a slap on the wrist. For that matter all false advertising would be wire fraud, but again that gets back to the point that everything is wire fraud.
I am accustomed to employing sarcasm, irony, satire, fiction and all sorts of devices in my speech and rhetoric. However it seems that sort of goofing-around isn't really supported by mainstream social media platforms. I have had several close friends and colleagues humorlessly prompt me to be more serious and less chaotic, especially on Facebook.
I can understand that saying things we don't sincerely mean, and outright lying or being insincere for supposed comedic or dramatic effect, can be utterly misconstrued in a public forum. Sadly, my mind is really conditioned to not even care what are the effects of what I say when I'm typing it into a computer.
I try not to maintain any public social media accounts, and so hopefully my sardonic sense of humor can be contained to friends and allies who sort of understand where I'm coming from.
I am well aware of “show me the man and I’ll show you the crime”. Just that this is clearly not that.
Let's turn the tables. Imagine instead of an individual doing this, it was a company doing basically the same thing but in reverse. So they populated their site with bots creating fabricated posts and people to drive 'manufactured engagement' from their users, try to reach critical mass, bloat their advertisement appeal, and generally make a bunch of money.
Is it still a felony worth spending years in prison for? I am speaking practically, not ideologically. The main thing this user did was to exploit advertisers paying out on the world's most gameable metric (exactly as our site would be doing in the above example). Yet that, in and of itself, is not a crime, which is why they ended up relying on wire fraud charges.
Have you read the article.
He’s indicted for mass streaming his own songs to pump up the play count. It’s outright fraud.
Big crime is never punished in America because you can buy freedom with small percentage of profits.
Go big or go to jail
> By flooding music streaming platforms with automated bots in the place of consumers, and fake songs in the place of creativity, Smith robbed millions in royalty payments from genuine artists and their fans. This Office is committed to ensuring the integrity of all markets, and protecting the public from those who use super intelligence for fraud.
He certainly didn’t defraud artists or their fans. This is false framing. He defrauded the streaming platform, which I’m sure the jury would be far less empathetic towards.
The money he got came from the same shared pool that the other artists get money from.
This is true, but kind of on the streaming platforms for having a terrible pooled monetization scheme that lets high frequency users allocate the subscription money of low frequency users.
I agree, they should do it on a per subscriber basis.
Oh lord. “Super Intelligence”
So the agencies are forced to pretend every ridiculous thing their king says is a great idea.
Except they left in "AI-generated" instead of using "SI-generated".
That's the writer, it's the US Attorney who has to kiss the boot.
The part saying he robbed streams from legitimate artists and fans is quite stupid but expected in a case like this.
If there was a sane payment system for spotify it would be literally impossible for that to be the case.
It says he robbed royalty payments which is true because of the way most of these services distribute royalties. All listens go into a global pool and count the same amount. So if you listen 20 hours a day, you control not only the royalty payments from your subscription but the royalty payments from several other people's subscriptions.
The true definition of AGI: when bots are accepted as consumers and their clicks on ads are as valuable as human clicks.
I am so going to force Gemini to consume as many google ads as google tries to foist on me. Brilliant idea. By their own definition that is just training right?
If you operate in a tight niche it might be economically worth botting ads to lower your competitors ctr.
There is an asymmetry where paying to create an impression is much more expensive than paying to consume an impression.
The AI is incidental to the story. The fraud is the fake streams for money.
When has any Facebook executive ever gotten a prison sentence for their horrendous doings? They just pirated all of Anna's Archive to feed into their AI.
Our legal system has been turned into a tool to punish the poor and enrich the wealthy.
Meta, Google and Apple are all currently claiming immunity in court for the explicitly illegal stuff they distribute and profit from - from scam ads and apps to illegal gambling apps.
> has been turned into a tool to punish the poor and enrich the wealthy.
was it ever othrewise?
I’m up for anyone and everyone pointing it out until it’s fixed. Which is hopefully one step on the path to action, which is on the path to change, and eventually resolution. Justice and fairness will be an ever present battle or at least vigilance.
Well he had 8 million.
When does he stop qualifying as the poor?
Confiscated. Now he qualifies.
"Taylor Swift received 9.3 million streams on YouTube Music from family plan streams in April 2023., In the same month, Smith’s bot accounts used family plans to fraudulently stream his AI-generated music 80.9 million times."
what always fascinates me about crime like this is, if this guy hadn't tried to make 8 million dollars with 10k bot accounts and boosted himself straight to the top, he could have easily made a few thousand per month. How are people clever enough to set this scheme up to begin with but don't consider that you maybe shouldn't try to alert the entire fraud department
which is to say there probably is someone out there who is committing this crime and being less greedy and getting away with it.
More like a lot of people.
If you pay for a $15/month service, how are you able to make more than $15/month in royalties?
Because you as a user don't distribute your $15. It's not like if you listen to one artist only, that artist gets your $15. Instead they throw it all into one pot and distribute it in accordance to the total plays. This is why Taylor Swift gets most of your money even when you didn't listen to her. I wish it was different.
Because essentially they are counting it wrong.
They basically put all the revenue into one pot, then divide it by the songs play count.
Which means that account that streams 10 000 plays, have more "voting power" on the revenue that one that just listens "normally"
Interesting. The site uses term super intelligence, BUT is used to spread negative portrayal of AI tech.
I think a lot of people are overlooking this line:
> he used fake email accounts and fraudulently-obtained debit cards to create the Bot Accounts.
I think this is likely where the 18-month sentence comes from.
What exactly is a fake email account?
Who knows... Are Apple's single-purpose icloud emails "fake emails"?
DOJ source: https://www.justice.gov/usao-sdny/pr/north-carolina-man-sent... (https://news.ycombinator.com/item?id=49995378)
the crime isnt the AI music its the fake views isnt it? i hate how the titles are being framed here
> ...(‘Super intelligence’ is the term that President Donald Trump has ordered government employees to use in documents and statements in the place of ‘artificial intelligence’.)
The intelligence formerly known as...
Meanwhile, other threads are blasting data centers for their energy consumption. At least that use seems like it should be somewhat efficient.
Bot armies ( trained to be inefficient to avoid detection ) streaming music over the wire en masse seems pretty wasteful. I wonder how many others are doing it?
I wonder if he would have gotten away with it if only he had stayed under well the radar.
Sam Altman is hiding tons of evidence of OpenAI's crimes. DOJ please investigate
DOJ doesn't monitor this site.
Try here: https://www.p3tips.com/Drill.aspx
This arrest was in 2024. This is the last remnants of a justice system being sunsetted.
super intelligence
stupid idea!
He is guilty of being smallfry and not a billionaire.
How is that not protected by the first amendment?
He was doing it fraudulently to make money.
I thought using bots in a misleading and inauthentic way was free speech. What about Elon's stock pumping twitter bots?
That may be true by itself. However, misleading and inauthentic speech to make money is fraudulent and illegal.
> misleading and inauthentic speech to make money
Isn't that just "marketing"?
Marketing cannot be misleading, otherwise it is definitionally false advertising, which is illegal.
Marketing is always misleading. It just can't be overly misleading.
Yet, so many politicians and elected officials walk free amongst us.
Who said those are legal? I'm sure that could be securities or wire fraud.
I'd like to read more about this court case
The whole entire problem is the system that is used to divide the income from songs. If it it was "the share of your subscription (or whatever ad-supported account is worth) gets divided to the songs you listen", most of the problem would be gone, at the very least for money from subscription accounts.
Instead, it is all dumped in one big pool and distributed by total listens.
Which means, if you listen to more songs, you have more "voting power" on who gets the money. Absolutely asinine system.
> SMITH pled guilty to one count of conspiracy to commit wire fraud
I need this guy’s lawyer
Imagine showing this headline to someone in the 80s or before.
Part of this does seem objectionable. But uhh, the other half, yikes. Superintelligence: ok for capital, not allowed for individuals.
> "Michael Smith exploited super intelligence technology to generate a fraud,” said U.S. Attorney Jamie McDonald. “By flooding music streaming platforms with automated bots in the place of consumers, and fake songs in the place of creativity, Smith robbed millions in royalty payments from genuine artists and their fans. This Office is committed to ensuring the integrity of all markets, and protecting the public from those who use super intelligence for fraud."
Wow, uh, he had a time machine?
> Smith’s streaming fraud lasted from 2017 to 2024
> “Michael Smith exploited super intelligence technology to generate a fraud,” said US Attorney Jamie McDonald.
Super intelligence. Aha. :)
Nothing artificial in that.
"AI" is now an unword. The all-powerful delusional sociopath in the White House has decreed the latest bit of Newspeak, and the spineless cowards throughout the government are scrambling to make sure to stay in lockstep with The Party.
This U.S. Attorney is obviously frightened he'll be taken to re-education should he use banned terminology.
If he's not careful he'll find himself at the bottom of Lake America.
so bizarre
Hey, grab me some freedom fries, the U.S. is getting more and more hilarious.
I hope you're not thinking ENEMY thoughts!
I asked super intelligence to determine if a series converges or diverges yesterday. It said cos(1 + n * pi) is always positive for all n… I must be wrong, not the super intelligence.
ask a better model
Won't somebody please think of the artists? /s
People here in HN seem to believe that royalty collecting companies are some sort of charitable organizations for the benefit of the artists. But their conduct and practices range from questionable [1] to outright fraudulent [2]. And now they manage to fly below the radar, because everyone (artists included) is busy bashing Spotify. These companies would sue Spotify out of existence had they offered the option to directly pay the artists instead of going through them.
[1] https://www.reddit.com/r/japan/comments/1302np/jasrac_this_i...
[2] https://torrentfreak.com/huge-scandal-engulfs-greek-anti-pir...
Feels like this is missing the bigger story, that this guy was using ai (AI!) to generate music in 2017-2024! /s
"poor man does something the wealthy owners of youtube did not like"
A digital society takes the value out of a place. There was a time when, if you did not Show Up, you were always alone.
He should have realized that you can't use AI agents to commit crimes without being the CEO of an AI company.
Genuine question: what if my agents produce better output if I stream audio to them while they work? Is that fraud?
His sole mistake was not to do that under a limited liability cooperation umbrella.
Feels like some kind of sentence to make an example of someone to scare off other people ala going after grandmas for napster. There's way too much of this going on on instagram and tiktok etc etc already. They went after this guy but is letting many people get away with it.