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Novel iTunes royalty scam busted in Britain
Fri, Jun 12, 2009
my paper

LONDON - A ring of crooked DJs said to have cheated iTunes and Amazon of over £200,000 (S$477,000) in music royalties has been busted by both Britain's Scotland Yard and the United States' Federal Bureau of Investigation (FBI).

In the first known instance of the scam, the musicians first placed their own music on iTunes - Apple's hugely successful online music store - and online store Amazon, reported the Daily Telegraph.

Starting last August, they used music-distribution service Tunecore to upload their albums to iTunes.

Stolen credit-card details were then used to rack up massive downloads of their music - some £450,000 worth - that suggested the "artistes" were exploding in popularity.

Some music-industry chiefs even zeroed in on them as emerging talent as their music rose on the charts.

Meanwhile, the crooked musicians were able to claim £200,000 in royalties from the online music sellers, having recorded 19 music compilations in all.

But the authorities ended their scam on Wednesday with a series of raids.

Ten people aged between 19 and 41, including three women, were taken into custody in London, Kent, Wolverhampton and Birmingham by detectives from Scotland Yard's e-crime unit, working with the FBI.

The DJs are now being interrogated for suspected conspiracy to commit fraud and money laundering.

They had purchased thousands of stolen credit-card numbers with which to open iTunes accounts and download their albums at US$10 (S$14.50) a pop.

The authorities began investigating the case last December, after credit-card companies alerted Apple that music was being purchased from iTunes with bogus accounts.

Detective chief inspector Terry Wilson of the e-crime team called it "a complex investigation".


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