The U.S. Copyright Office has opened a formal inquiry into music streaming fraud. Its notice of inquiry was published in the Federal Register on October 7, 2026, and asks the public how fraud on streaming services works, how it is being fought, and what Congress could do about it.
That might sound far from the world of ebooks and templates. But a lot of digital product sellers also buy or sell music loops, background tracks, “royalty-free” music packs and, increasingly, AI-generated audio, often under PLR or resale licenses. The questions this inquiry raises about who owns a track, who may distribute it and how AI-made music fits into the royalty system overlap with that market.
Here’s what the notice says, what it doesn’t, and some sensible steps if music or audio is part of your product line.
Where the inquiry came from
According to the notice, the Office is responding to a May 21, 2026 letter from Representative Scott Fitzgerald, written on behalf of the House Judiciary Committee. The notice was signed on October 5 and published two days later as Docket No. 2026-6.
Written comments are due by 11:59 p.m. Eastern on November 23, 2026. Reply comments, which respond to what others have submitted, are due by 11:59 p.m. Eastern on December 21, 2026.
What counts as streaming fraud
The notice describes streaming fraud as using deceptive or unauthorized methods to artificially inflate the number of streams a track receives. Because most streaming royalties are paid on a “pro-rata” basis, more plays generally mean a larger share of a fixed pool of money. Fake plays therefore take money away from everyone else.
Methods the notice lists include:
- Bot farms and click farms that generate automated or paid-for plays
- Playlist stuffing
- Account hijacking and other forms of user manipulation
- What the notice calls “copyright fraud,” such as claiming other people’s works as your own or uploading altered versions of them (sometimes described as “carbon copying” or “ghost tracking”)
Besides diverting royalties, the notice points to secondary harms: distorted playlist placement and recommendations, unreliable data that artists use for decisions such as touring, and fewer chances for lesser-known artists to be discovered.
The AI angle
AI is a big part of the backdrop. Music Business Worldwide reports that Fitzgerald’s letter asked the Office to look at AI’s role, saying generative AI “can serve as a catalyst for criminals to perpetrate streaming fraud.” The same report notes that the letter cited streaming service Deezer’s finding that up to 85% of streams on fully AI-generated tracks on its platform in 2025 were fraudulent.
One of the inquiry’s ten topics asks directly how streaming fraud relates to AI-generated music and to licensing and royalties for both songs and sound recordings.
The case that keeps coming up
The notice also refers to a federal criminal case in New York in which a North Carolina man was accused of using thousands of bot accounts and AI-created songs to collect roughly $10 million in royalties. He pleaded guilty in March 2026 to conspiracy to commit wire fraud. Music Business Worldwide reports that he was sentenced to 18 months in prison and that, on October 6, the judge ordered him to forfeit about $8.09 million.
The ten questions the Office is asking
In plain terms, the notice invites comments on:
- How streaming fraud is carried out and how common each scheme is
- Industry practices that may unintentionally make fraud easier
- The current and projected economic impact
- How fraud relates to AI-generated music and to licensing and royalties
- Links between streaming fraud and live performance, such as venue choices and ticket sales
- Which anti-fraud methods are being used and how well they work, including trusted distributors, identity checks, royalty clawbacks, fines and content removal
- How ownership and usage data could help, including suspicious-activity reporting, a shared fraud database, metadata standards and labeling content that isn’t eligible for royalties
- Possible voluntary, statutory or regulatory solutions
- How criminal enforcement could be improved
- Any other recommendations for Congress
What this means if you buy or sell music and audio products
Nothing in the notice changes the law today. It is an information-gathering step. Still, it is a useful prompt to tidy up how you handle audio products. The points below are general information, not legal advice.
1. Read the license for distribution rights
Many music packs sold with PLR, resale or “royalty-free” licenses are meant to be used inside something else: a video, a podcast, a course or an app. Whether you may upload the track itself to streaming services, or register it for royalties as your own release, is a separate question. Check the actual license terms, and if they don’t clearly say yes, assume the answer is no.
2. Don’t release shared tracks as your own
PLR products are, by design, sold to many buyers. If several license holders all upload the same track to streaming services under different names, that looks a lot like the “claiming other people’s works” and “altered versions” behavior the notice describes. Even where a license technically allows it, it is a poor idea.
3. Keep good records
Save your purchase receipts, a copy of each license as it was when you bought it, and notes on which AI tools (if any) were used to create tracks you sell. If a platform or a buyer ever questions where a track came from, you will want that paper trail.
4. Be upfront if you sell AI-made audio
If you create music packs with AI tools, tell buyers clearly how the tracks were made and what they may and may not do with them, including whether streaming distribution is allowed. The inquiry’s interest in labeling content that isn’t eligible for royalties suggests this is an area to watch.
5. Steer clear of “guaranteed plays” services
Any service promising a set number of streams for a fee deserves serious suspicion. Artificially inflating plays is exactly what this inquiry is about, and it can put your accounts at risk.
How to have your say
Anyone can comment, including small creators and sellers. Comments are submitted electronically through Regulations.gov under docket COLC-2026-0166, and the Copyright Office’s music streaming fraud page has instructions. If music or audio products are a meaningful part of your business, a short, factual comment about your experience is a legitimate way to be heard.
What happens next
A notice of inquiry does not create new rules. Music Business Worldwide points out that a similar Copyright Office inquiry into performance rights organizations, opened in 2025, drew more than 5,000 comments and ended with a summary letter to Congress that contained no new policy recommendations. This one could lead somewhere different, especially given the AI questions, but any real change would likely take time and would most likely come from Congress.
For now, the practical takeaway is simple: know exactly what your audio licenses allow, keep your records in order, and treat streaming distribution as something that needs explicit permission. For specific questions about your situation, talk to a qualified attorney.
Sources
- Federal Register: Music Streaming Fraud (notice of inquiry, Docket No. 2026-6)
- U.S. Copyright Office: NewsNet Issue 1095
- Music Business Worldwide: Music streaming fraud inquiry launched by US Copyright Office
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