Music streaming service, Spotify accused of fraud

Spotify has responded to a report from earlier this week on Vulture that alleged the streaming service was paying producers to create songs under fake names that were then put on premium playlists to generate money for the service.

“This upfront payment saves the company from writing fat streaming checks that come with that plum playlist placement, but tricks listeners into thinking the artists actually exist and limits the opportunities for real music-makers to make money,” reads the article.

If true, the allegation would basically constitute fraud and Spotify could be in some serious trouble.

Billboard reached out to the article’s author, Adam K. Raymond, to find out what reports he had to substantiate his claims.

According to Billboard:

Spotify, when reached for comment on the allegations, vigorously refuted them.

“We do not and have never created ‘fake’ artists and put them on Spotify playlists. Categorically untrue, full stop,” a Spotify spokesperson wrote in an email. “We pay royalties — sound and publishing — for all tracks on Spotify, and for everything we playlist. We do not own rights, we’re not a label, all our music is licensed from rightsholders and we pay them — we don’t pay ourselves.”

The majority of the Vulture article focused primarily on individuals who “game” the system with tracks that often confuse the public, including releasing covers of songs by much bigger artists, misspellings of artist names (Bob Segar), customized playlists (Happy Birthday songs) and other shenanigans that existed on iTunes and other services well before streaming became the dominant music platform it is today. 

When asked for a comment on gaming Spotify’s system, the same spokesperson said the following: “As we grow there will always be people who try to game the system. We have a team in place to constantly monitor the service to flag any activity that could be seen as fraudulent or misleading to our users.”