Streaming fraud is back in the spotlight in Denmark where a man is in court over allegations he fraudulently generated £500,000 of income from the streaming services by uploading copyright infringing tracks and using manipulation tools to boost their streams.
There has been lots of debate and media coverage about streaming fraud over the years, but little criminal action. Although anyone hoping for a quick legal precedent to be set by this case may be disappointed. The defendant's lawyer told Danish broadcaster DR: “I don’t think that such a case – regarding matters which the prosecution believes to be data fraud in connection with playbacks of musical works via various tendering services – has ever been tried in court".
“Somewhat dependent on the result, there is a possibility that both my client and the prosecution will appeal the verdict to the high court", he added, before predicting the matter could end up before the country's Supreme Court.
Prosecutors allege that the accused man distributed 689 pieces of music to streaming services, including Spotify and Apple Music, between 2013 and 2019. The huge numbers of streams that were then generated by those tracks demonstrate that manipulation tactics must have been employed, it's alleged.
Ditte Rie Agerskov from the Danish Rights Alliance says that the music uploaded by the defendant got streams at a scale “only achieved by major international stars”. According to The Guardian, the Alliance first reported the suspected fraud in 2018. The matter was then investigated by Denmark's National Unit For Special Crime.
“Criminals see a market in generating artificial plays that mimic organic listening patterns, in order to access royalties from music streaming services", Agerskov added. "However, artificially generated plays are in violation of the user terms found on music services".
There are many different kinds of streaming fraud, with some of the manipulation happening within the music industry, and some by opportunists outside the sector gaming the business model employed by services like Spotify. It will be interesting to see what tactics the defendant allegedly employed to boost the streams of his music, although streaming fraud has evolved since 2019 and scammers are likely also employing other manipulation methods today.
The fact that the man in this case was gaming the system on multiple services demonstrates that tackling streaming fraud requires a joined-up approach, involving all the streaming platforms and all the distributors. That can be achieved through initiatives like the Music Fights Fraud Alliance and platform-agnostic anti-fraud specialists like Beatapp.
Legally speaking there needs to be a multi-pronged approach, with the industry pursuing legal action against the websites that provide manipulation services, while also following the money and putting pressure on their payment providers. But agencies like the National Unit For Special Crime also have a role to play. The Danish case may provide some useful insight in that domain.
Prosecutors in the case are reportedly seeking a fine, prison sentence and the confiscation of the defendant’s royalties.