AI music fraudster faces 46-month prison recommendation

Michael Smith faces a federal sentencing recommendation of at least 46 months in prison after pleading guilty to conspiracy to commit wire fraud tied to AI-generated songs and bot-driven streams. The U.S. Attorney's Office for the Southern District of New York filed a sentencing memorandum on September 29, 2026, seeking the prison term plus forfeiture of $8,091,843.64 Digital Music News.

Smith pleaded guilty on March 19, 2026, before U.S. District Judge John G. Koeltl in Manhattan Music Business Worldwide. According to prosecutors' filings, Smith had "labored almost daily to perpetrate massive fraud," generating artificial songs and using automated bot networks to inflate streaming counts and pocket royalties that rightfully belonged to legitimate songwriters Billboard.

Prosecution vs. Defense Arguments

The sentencing memorandum reflects sharp disagreement over appropriate punishment. Federal prosecutors argue the scale and deliberation of Smith's scheme warrant significant prison time. The U.S. Probation Office, however, recommended a lighter sentence of 24 months Digital Music News. Smith's defense team requested probation with no prison time, arguing that no artist suffered "perceptible harm" from the streaming scheme.

Sentencing Set for October 6

Smith is scheduled to be sentenced on October 6, 2026, before Judge Koeltl at the U.S. District Court for the Southern District of New York in Manhattan. The case marks one of the first major federal criminal convictions involving AI-generated content and automated fraud infrastructure, setting a potential benchmark for how courts handle agent-driven schemes that exploit digital platforms.

The $8 million in restitution sought represents the scale of losses prosecutors say Smith inflicted on the music ecosystem by systematically diverting streaming revenue through fraudulent AI-generated content and bot manipulation.