Two men have been charged with theft of $ 20 million in multi-year musical royalties from a certain company identified as “YT”. explicitly name “YouTube”. We can, however, infer from court documents that “YT” is a website that hosts downloads and uses the exact same monetization and content identification mechanisms as YouTube. Well, there really is a single site like YouTube.
A public affairs official in the U.S. Attorney’s Office was unable to confirm the identity of the company, and YouTube did not respond to Gizmodo’s request for comment.
According to court documents (first reported by Market surveillance), Webster Batista, aka “Yenddi” and Jose Teran, aka “Chanel” fraudulently claimed the royalty rights to over 50,000 songs through LLCs that sounded like record labels. A grand jury charged them with conspiracy, wire fraud, identity theft and money laundering.
As noted in court documents filed with the Arizona US District Court, the men more or less simply claimed to be the copyright holders, and that was it. They told “AR”, the company that handles “YT” royalty payments, that their company “MediaMuv” owns the copyright to a library of more than 50,000 songs. They signed a contract with AR, who tagged and uploaded the music for MediaMuv. They started to collect income. This lasted from 2017 to April 2021.
“YT” approved them for Content ID, YouTube’s automated system that hypothetically identifies matching songs from other users’ downloads and allows the content ID holder to claim their ad revenue, if they so choose. They also signed a sound recording and audiovisual content license (this), who hypothetically allows Google to widely offer music to users in return for monetization revenue.
The first song named is “Viernes Sin Tu Amor”, from which they are said to have raised $ 24,000. This was followed by “La Quise Tanto”, which grossed over $ 30,000, and “Me Llamas”, which grossed them over $ 100,000. (Various artists titled the songs “Me Llamas”, but especially Piso 21’s massive blow with over 700 million views on YouTube.)
Prosecutors allege that over time money was transferred between companies with similar sounding names – Elegre Records, Musika Ink LLC, MuveMusic LLC. The bank accounts of these companies were allegedly used to buy a house for $ 550,000, a Tesla for $ 130,000, a BMW for $ 92,000 and $ 62,000 in jewelry. Batista obtained a Pennsylvania ID card under a false name.
In 2018, someone claiming to be a Rights Holder (“DH”) discovered and reported MediaMuv to the Royalty Administrator. Teran doubled down and hinted that the person was just doing the same scam, claiming to deserve the royalty money “just because he said [sic] he has the right to do so.
IRS agents arrested Batista at his Florida home on November 18. According to the US attorney’s office, they could each face a cumulative sentence of 37 years in prison and up to $ 250,000 for each felony conviction.