Money Laundering on Spotify (and Similar Platforms).
Spotify and money laundering? Sounds strange, right?
That’s exactly the reaction I usually get when I bring this up in training sessions.
After all, Spotify is just a music streaming platform, right? You press play, listen, and that’s it. Or maybe you upload your own music for others to hear.
And that’s precisely where the loophole lies.
Spotify is a streaming platform, sure. But it’s also a marketplace.
On one side, you have creators sharing their content (music). On the other, you have listeners. Creators earn money based on how much their music is played. Listeners pay for access.
Spotify acts as the intermediary. That’s its business model.
So how does money laundering fit in? Here’s an interesting example that made headlines not too long ago:
A bad actor looking to launder dirty money creates an artist account on Spotify and uploads fake music (possibly AI-generated). Then, they create a large number of listener accounts, funding them with prepaid cards, PayPal, or gift cards loaded with illicit cash.
These accounts then stream the fake artist’s music on repeat.
Since Spotify pays artists based on play counts, the fake artist receives legitimate payouts for those streams.
Pretty clever, right?
It’s not easy to pull off, though:
- Streaming platforms don’t pay huge amounts per stream.
- It requires a massive number of listener accounts and fake artists to launder significant sums.
But it is possible.
Until the scheme was exposed, most people had no idea this was even a thing.
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