Anti-Fraud Policy

Anti-Fraud Policy
Overview

For the purpose of this Policy, the “End User” is the person or legal entity that has entered into a contractual relationship with Fluky Digital, accepting the Terms of Use and providing content that will be made available on Digital Service Providers (DSPs). “We” or “Us” refers to Fluky Digital, the provider of the service.

Purpose

The purpose of this policy is to:

  • Provide a clear definition of what we mean by “fraud”.
  • Summarize the responsibilities of End Users for avoiding fraudulent activities.
  • Offer guidance to all parties involved on actions to be taken when Fluky Digital, the DSP, or any other third party suspects fraudulent activity.
  • Provide clear guidance on responsibilities for conducting investigations into fraud-related activities.
  • Protect rights holders who may be victimized as a consequence of fraudulent activities.

This document should be read in conjunction with:

Definitions

End User: The person or legal entity that has entered into a contractual relationship with Fluky Digital for the use of the platform.

User Account: Accounts owned by End Users.

Fraud: The unauthorized exploitation of material protected by copyright (Copyright Infringement); infringement of any law regulating the ownership of legal rights holders; use of modified artist, band, or label names or artwork which may create confusion or false expectations related to content served to consumers by DSPs (i.e., Musical Spam); use of automated digital bots or other means to “click” on payment-generating links pretending to be consumers (i.e., Click Fraud), producing unnatural and fraudulent incomes; upload of distorted music to generate revenues, and other unauthorized activities which are in breach of the Terms of Service or the agreements with DSPs.

Policy

Fraud in all its forms is wrong and unacceptable to us because:

  • It results in loss not only to us and the DSPs but also to other content creators, damaging their copyrights, reputation, or reducing the royalty pool available by the DSPs to content creators.
  • It can have a major impact on our reputation and contracts with DSPs, affecting other End Users using our services.

Our objective is to avoid and, if necessary, eliminate fraudulent usage of our services. Any indications of fraud will be rigorously investigated and dealt with firmly and controlled.

What DSPs Are Doing About It

Most DSPs use a mix of algorithms and humans to scan their catalog to avoid potential fraud or unauthorized use of their service. Once they identify fraudulent streaming, they may take down the content and inform us about the case, reserving the right to withhold future payments generated through suspicious activities.

What We Are Doing About It

We actively take action in the following fields:

  • Automatically monitoring historic sales data combined with other information (e.g., artist profiles, End User information, social media) to detect possible irregular activity.
  • Fingerprinting our entire back catalog and all new tracks, matching against several databases to avoid multiple uploads of the same song, uploads of “white noise” or “empty songs”, uploads of already copyrighted materials, and any unauthorized activity.
  • Employing quality control (QC) processes to track misleading metadata, resulting in Musical Spam or other unauthorized activities.
How We Deal with Suspected Fraud

If we detect or suspect any unauthorized activity (including bot-generated streams, click fraud, music spam, etc.) from a specific account, we will require the corresponding End User to cease such activities and warn them via a 3-strike policy system, which may result in the blocking of the End User account if our warnings are ignored.

  • Revenues in any account received in connection with content that we believe, in our sole discretion, violates the Terms of Service, can be blocked and retained.
  • Blocked accounts can only be unblocked following the strict protocol described below.
The Consequences of Fraudulent Use of Our Platform or Services

If an End User breaches the Terms of Use, we have the right to terminate the contractual relationship. Any amounts due to an End User from any DSP for fraudulent or unauthorized use of the service may be recouped by withholding such amounts from future payments. Additionally, any costs incurred by us or our providers (including legal fees and expenses) may be deducted from any future payments due to an End User.

Severity, Strike Policy, and Blocking of Accounts

Severity

During our QC process, the sales confirmation process, or through notifications received from DSPs, we may detect possible fraudulent content or accounts. These issues are divided into three severity tiers:

  • F0: Critical issues related to an End User Account.
  • F1: Issues related to Click Fraud.
  • F2: Issues related to Musical Spamming and Copyright issues.
Strike Policy

In case we detect an F1 or F2 issue in a User Account, a strike is applied to the account, and the End User will receive a ticket or notice indicating the detection of potential infringing or unauthorized activity. The consequences of the strike system are:

  • Strike One: The End User is informed, questioned content is taken down, and a warning is issued regarding further strikes.
  • Strike Two: The End User is informed, questioned content is taken down, and a warning is issued that the account will be blocked on the third strike.
  • Strike Three: The End User is informed, the account is blocked, all End User content is taken down, and royalties are kept in escrow for five years.

Once an End User has received three strikes, their account will be blocked.

Blocked Account Policy

If an End User cannot or refuses to provide the requested information and/or documentation within five working days, we may block and withhold revenues in any User Account received in connection with content that we believe, in our sole discretion, violates our Terms of Use or agreements with DSPs. The blocked accounts will not be able to access the platform or enjoy our services. If no response is received from the End User, all content from the involved account may be taken down. Royalties corresponding to the infringing content will be kept in escrow for up to five years.

Unblocking an Account

If an End User provides the requested information within five working days and the information is verified, the account can be unblocked. We may request the End User to complete the following steps:

  • Fully complete the End User information.
  • Provide a copy of an identification document (passport or national ID).
  • Provide artist profiles, website URLs, and social media profiles with historical data to support the sales data.
Resolving a Strike

To release a strike and reduce the risk of blocking their account and/or takedown of uploaded tracks, End Users may be required to:

  • Correct the release metadata.
  • Provide proof of ownership of the uploaded tracks.
  • Acquire applicable licenses.

If the provided information suffices, the strike will be resolved. If the information requirements are not met, the strike will remain and be added to existing ones.

Withholding Royalties (“Escrow”) for Blocked Accounts

Revenues in any User Account that are received in connection with content that we believe, in our sole discretion, violates the Terms of Use may be blocked and withheld. The money is kept in escrow for up to five years to respond to situations such as:

  • An End User proving their account is not fraudulent.
  • Claims from DSPs asking for a refund of royalties generated through unauthorized or fraudulent activity.
  • Claims from legitimate rights holders.
Takedowns

We will initiate takedowns of confirmed infringing content for User Accounts and all content involved in F0, F1, or F2 issues. Note that any content may be marked as suspicious by DSPs at their sole discretion and may be taken down at their discretion.

For any questions or support, please contact us at support@flukydigital.com.