Written by: Haim Ravia, Dotan Hammer
On October 7, 2026, the U.S. Copyright Office published a Notice of Inquiry in the Federal Register seeking public comment on music streaming fraud, including its prevalence, its economic effects, its relationship to AI-generated music, and possible voluntary, statutory and regulatory solutions. The inquiry responds to a May 21, 2026, letter from Representative Scott Fitzgerald, a member of the House Judiciary Committee, to Register of Copyrights Shira Perlmutter, which asked the Office to examine the contributory effects of artificial intelligence on music streaming fraud, the prevalence of such fraud across digital platforms, and its effects on the licensing and distribution of royalties for sound recordings and musical works.
The Notice explains why streaming fraud has become a significant concern. Streaming now accounts for roughly 70% of global recorded music sales, generating approximately $9.5 billion in revenue for sound recording owners in the United States. Because most streaming royalties are distributed under a pro-rata model from a finite royalty pool, artificially inflated plays divert money away from legitimate artists, songwriters and rights holders. The Office describes streaming fraud as the illegitimate practice of using deceptive, inappropriate or unpermitted methods to inflate plays, and catalogues the principal methods: bot farms using automated accounts, click farms using human listeners, playlist stuffing, account hijacking, the manipulation of user activity, and copyright fraud, such as uploading altered copies of others’ works. Beyond the dilution of the royalty pool, the Notice identifies secondary harms, including distorted playlists and recommendations, unreliable data for touring and business decisions, and reduced discovery of lesser-known artists.
Artificial intelligence features prominently in the inquiry. The Notice points to United States v. Smith in the Southern District of New York, in which a musician allegedly used thousands of bot accounts to stream hundreds of thousands of AI-generated songs, collecting roughly $10 million in royalties, and pleaded guilty in March 2026 to conspiracy to commit wire fraud. It also notes a recently filed lawsuit by Universal Music Group against the music distributor DistroKid, which alleges that the distributor facilitated the mass distribution of AI-generated, infringing tracks. The Office observes that because the profitability of streaming fraud grows with the size of a catalogue, generative AI makes large-scale schemes cheaper to execute.
The Notice poses ten questions. They address how streaming fraud is executed and how prevalent specific schemes are; industry practices that may unintentionally contribute to fraud; its current and projected economic impact; its relationship to AI-generated music and to royalties; links to live music, including venue selection and ticket sales; the effectiveness of existing mitigation methods, such as content and customer verification, royalty clawbacks, fines and takedowns; and the role of ownership and usage data, shared fraud databases and metadata standards. The Office also asks for views on voluntary best practices and legislative options, including no-fault injunctive relief proposed in pending bills, adjustments to information-sharing rules, and ways to improve criminal enforcement, including against organized crime’s use of streaming fraud.
Click here to read the Copyright Office’s Notice of Inquiry.
