The Western High Court in Denmark has upheld last year’s district court ruling against a Danish music industry executive who ran a streaming fraud operation that generated millions of kroner.
Not only that, but the higher court has actually increased the man’s sentence from eighteen months to two years on the basis there was evidence of “extensive fraud” amounting to no less than 3.5 million kroner (approximately £392,500).
That decision is important, says Maria Fredenslund of Denmark’s Rights Alliance, because it confirms “that manipulating music streaming is illegal” and that “such actions will be punished”. This, she adds, “has significant implications for all the artists and rightsholders who have been deprived of royalty payments for their music”.
In addition to the two year sentence, the high court has confiscated 1.5 million kroner from the fraudster himself and another 2 million from his company, which has also been fined 300,000 kroner. He will also have to personally cover half of the legal costs associated with the appeal.
However, the High Court declined to consider compensation claims made by some of the impacted rightsholders within the music industry, instead deciding that those claims should be separately considered via civil litigation.
Perhaps unsurprisingly, Fredenslund criticises that part of the ruling, noting that her organisation first raised a complaint about the streaming fraud operation at the centre of this case all the way back in 2018.
“Given this case has already dragged on since our initial report in 2018”, she says, “it is unfortunate that it must now continue in civil court. If even a high-profile case like this – where massive fraud has impacted the entire Danish music industry – does not lead to compensation, we fear that in practice, obtaining restitution is not a real possibility for rightsholders”.
The fraudster, who worked in music distribution, ran his fraudulent operation from 2013 to 2019, uploading tracks that he claimed to own - many altered versions of recordings by other artists - and then employing stream manipulation tools to boost the streaming of that music, so that he could pull royalties out of platforms like Spotify and Apple Music. He was found guilty of both aggravated data fraud and copyright infringement.
He could as yet further appeal his conviction through Denmark’s Supreme Court, although that would first need approval from an appeals permission board. Under Danish law, he won’t actually serve any prison time until all routes of appeal have been exhausted.