YouTube’s Content ID system helps rightsholders and content creators prevent copyright infringement.
Copyright holders can either remove problematic content from the video platform or monetize it instead.
Monetization is preferred in many cases and can be quite lucrative. Over the years, the Content ID platform has generated more than $9 billion in ‘claimed’ advertising revenue.
Criminal Content ID Scam
This option isn’t just utilized by legitimate owners, scammers have been making use of it too. While it’s unknown how often the system is abused, an indictment published by the Department of Justice in late 2021 showed that a U.S. company run by two men built a multi-million dollar business on this scheme.
A criminal investigation revealed that Webster Batista Fernandez and Jose Teran ran a massive YouTube Content ID scam. By falsely claiming to own the rights to more than 50,000 songs, the pair generated more than $23 million in revenue.
The scammers’ company, MediaMuv LLC., wasn’t a direct member of the Content ID program. Instead, it operated through a trusted third-party company, which had access to the platform.
Both defendants signed guilty pleas and faced long prison sentences. Teran, who was described as the “number two” of the operation, was sentenced to more than five years in prison a few weeks ago. The custodial sentence came as a disappointment to the defense, which had requested mild probation or home confinement instead.
Court Sentences “Lead” Scammer
The second defendant, Mr. Fernandez, also sought leniency from the court. His attorney argued that a 46-month prison sentence should be sufficient, noting that his client takes full responsibility for his wrongdoing.
“Mr. Fernandez concedes that he made a terrible decision to become involved in criminal conduct, which has not only affected his family and children, but has also caused financial harm to the victims involved in this case.”
In this instance, U.S. District Court Judge Douglas L. Rayes found the recommendation persuasive. Late last week, Mr. Fernandez was sentenced to exactly 46 months in prison, as suggested.
“It is the judgment of this court that the defendant is committed to the custody of the Bureau of Prisons for a term of forty-six months,” the order reads. This prison term will be followed by three years of supervised release.
Forfeited Cash and Restitution
In addition to the jail time, Mr. Fernandez will also forfeit possessions related to his crimes. His stake in over a million dollars seized by the authorities, for example, plus several pieces of real estate and cars.
The authorities described the YouTube scam operation as one of the “largest music-royalty frauds ever perpetrated” and it invites potential victims to come forward to claim their part of a restitution fee, in an amount yet to be determined.
The list of illegitimately claimed songs exceeds 75,000 titles, which once again illustrates the scope of this multi-million dollar scam.
Finally, it is worth noting that Mr. Fernandez, who supposedly initiated the scheme, received a significantly lower sentence than his partner Mr. Teran. The reason for the disparity is not revealed in available paperwork, however, and the authorities have yet to comment on the sentencing.
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The sentencing order for Mr. Fernandez can be found here (pdf)
