Mike Smith sentenced to 18 months in streaming fraud case, Rolling Stone reports

Mike Smith, a musician and business owner from North Carolina, received an 18-month prison sentence in federal court in Manhattan on Tuesday afternoon, Oct. 6, after pleading guilty to charges of music streaming fraud, Rolling Stone reported.

John G. Koeltl handed down the sentence, which will be followed by two years of supervised release. Smith previously agreed to forfeit $8 million as part of his plea deal for the federal wire fraud conspiracy.

Smith Receives 18-Month Prison Term

The 18-month prison term fell well short of the 46 months prosecutors had sought, though defense attorneys had asked for probation. Before hearing his sentence, Smith addressed the court directly while choking up, telling the judge that his goal in life had been to be a good husband, father, and upstanding member of society.

By “committing this crime,” Smith said, “I have failed miserably.” He added that he “betrayed the music community I care so much about,” admitting that he turned his love of music into a “perverse business model,” and concluded that he had “made a mess of what was an honorable life.”

When the judge asked if he had any final comments after the sentence was read, Smith replied, Thank you for your consideration on everything, Your Honor. Attorneys Nicholas W. Chiuchiolo and Kevin B. Mead argued that a significant prison sentence was required to deter other potential fraudsters and provide just punishment.

Smith Used Bots to Inflate Music Royalties

Prosecutors stated that between 2017 and 2024, Smith used an army of bots to artificially stream his own music millions of times. Beyond his personal catalogue, Smith allegedly generated additional unearned royalties by purchasing and uploading AI-generated songs and running bot streams on them.

Defense attorney Justine Harris argued during the hearing that when Smith began the operation, many streaming platforms did not explicitly prohibit bot usage in their terms of service. Harris also maintained that while the scheme pulled millions from the overarching royalty pool, actual financial damages to individual artists were minuscule and difficult to calculate.

Industry Support and RZA Letter

Smith’s sentencing submission included letters from friends, family, and music industry peers urging the court to spare him from prison to prevent separation from his children. Among the letters was a submission from the Wu-Tang Clan’s RZA, who collaborated with Smith on various projects during the 2010s, including a rap reality competition called One Shot and a 2024 horror film titled Nyctophobia.

Mike has always acted honestly with me and with the artists and business partners we have worked with. I have seen him use his connections and resources to help people who might not have had those chances otherwise.

RZA

Despite the letters of support and defense arguments pointing toward structural industry reforms rather than individual incarceration, the federal court proceeded with the 18-month prison term and the $8 million forfeiture agreement.