According to the SvD newspaper, Swedish gangs use Spotify to launder dirty money.
Four Stockholm gang members, along with an anonymous police investigator, spoke to the Swedish newspaper, “Svenska Dagbladet”, about hiding money trails linked to violent crime.
Revenues from drug deals, contract killings and thefts are hidden through artificial streaming deals.
Criminals first pay musicians through a cryptocurrency transaction, which is harder to trace than a traditional payment. The artists are then paid for playing their songs, and the criminal can collect the laundered money.
“Spotify has become a banking distributor for gangs”the investigator cited in the SvD report told the newspaper.
The music platform nevertheless assured AFP that “less than 1% of all streams on Spotify have been determined to be artificial”adding that any manipulated figure is “rapidly mitigated before any payment”.
According to SvD, one million streams generate around 40,000 to 60,000 crowns in Sweden, or approximately 3,450 to 5,180 euros.
Spotify’s royalty system has recently come under fire because it allows users to cheat the system, instead of channeling revenue to real artists.
JPMorgan executives have estimated that ten percent of all streams on the platform are generated by automatic listeners, and that Spotify subscribers could earn $1,200 (1,140 euros) per month by listening to their own song on repeat.
This theory was first reported by the Financial Times last month, but Spotify CEO Daniel Ek has since dismissed the claims.
The Spotify website states that “Contrary to what you may have heard, Spotify does not pay royalties to artists based on a per play or per stream rate. The royalties artists receive may vary depending on how their music is streamed or agreements they have made with labels or distributors.”
