An individual in Brazil has been charged over their involvement in a streaming fraud scheme that generated over $65,000 in Spotify royalties. The alleged fraudster is accused of manipulating the streams of over 400 tracks that they uploaded as part of the scam, some of which were stolen from local artists and composers via WhatsApp groups.
The charges have been made by the cybercrime unit at the Prosecutor’s Office of the state of Goias. They followed an arrest made last December as part of an initiative called Operation Out Of Tune, which is backed by Brazilian record industry trade group Pro-Música Brasil, the country’s anti-piracy body APDIF and global organisation IFPI.
“Stream manipulation is one of the biggest concerns of the music sector”, says Paulo Rosa, President of Pro-Música Brasil, in a statement welcoming the criminal charges and applauding the Goias cybercrime unit “for this successful operation”. Pro-Música will continue, she adds, “to work closely with Brazilian authorities to tackle these fraudulent practices”.
IFPI CEO Victoria Oakley says: “Simply put, streaming manipulation of this nature is theft – stealing directly from artists and betraying fans. We commend the actions of the state of Goiás prosecutor’s cybercrime unit for their work in this case and will continue to work closely with local authorities in Brazil, but more broadly across the world, to ensure this illegal activity is stopped”.
There are various different kinds of stream manipulation and streaming fraud, including schemes like this one, where a person uploads their own music to the streaming platforms and then employs stream manipulation - either on their own accounts or via hacked accounts - to boost the streams of those tracks.
Because of the way the streaming business works, even if the fraudster is boosting streams via their own accounts, they can still pull more money out in royalties than they put in by buying subscriptions.
In these scenarios, it’s common for the fraudster to illegally upload other people’s music, sometimes manipulated in some way, and then claim that they are the rightsholder. Or they might use generative AI to create the music.
According to IFPI, at least 36 of the uploaded tracks in this case were stolen from local composers via promotional WhatsApp groups, although its thought generative AI was also subsequently employed.
Cracking down on streaming fraud requires various different tactics to be employed, including going after the public-facing stream manipulation service providers, as well as investigating and prosecuting individuals who are directly running streaming fraud schemes.
The Brazilian record industry has been particularly proactive in going after the stream manipulation service providers, and now seems to be turning its attention to those actually running the scams.
So far there have only been a small number of criminal cases relating to streaming fraud around the world. In Denmark, a man was convicted of streaming fraud in March last year, while in September prosecutors in New York charged a man with wire fraud and money laundering in connection to an alleged streaming fraud enterprise.