If anything sounds too good to be true, it probably is. In the music industry, if someone offers you a contract and deep down in your gut you feel cautious about it, DON’T SIGN IT. Have your lawyer look at it first. While there are many sketchy figures working in the music industry waiting to take advantage of what could be the next big thing, some are more devious than others.
Recently I saw a very well done indie movie called Great World of Sound. It is about the world of “song sharks” – hustlers that go around (usually the Southern and Midwestern states) and hold auditions for new musical talent. They are usually set up in motels or odd locations. After hearing the audition, the “record executives” offer the person a record contract or songwriting deal, a “once in a lifetime opportunity.” However, the offer is that the record company will make an “investment” in the artist of some amount, say $5,000-20,000, but that the artist has to put up good faith money to show they are serious and to cover some expenses. They ask the artist for an amount usually between $2,000-$5,000. As you can imagine, once the artist gives them that money, that is likely the last they hear from the record label – although in some cases the label gives them a nominal amount of amateur musical tracks to use and says they have obliged the contract. The sharks will operate in a home base for a few months then move shop before the police and federal government catches on (the main liability for them is mail and wire fraud).
The amazing thing about Great World of Sound is that their actors actually did this in various cities; with a hidden three-camera setup they filmed actual people who thought they were auditioning. The actors proceeded to give the sales pitch and amazingly, many people turned over thousands of dollars of their money (which was obviously returned at the same time they would have signed their waivers, right after their “audition”). The movie combines a solid story line with good acting and this amazing reality show element to give an insightful look into the world of “song sharks.”
Not long ago, we were contacted by a group that was taken by one of these “record labels” in real life. They had paid them several thousand dollars via an irreversible Western Union money wire to get the chance to record with a “top producer.” This fake label’s website listed some of the most famous producers in music today as their contributing producers (what should have been an obvious tipoff, it’s unlikely that Quincy Jones works with those guys). After paying their thousands, the artists were sent a TEN SECOND sample of music to record a song. The confused artists looped the sample and actually laid lyrics on it (they said it was not a good sample either). They sent it back to the shark label and not surprisingly, the “producer” there rejected it and said it would cost even more money to fix the track. The label called repeatedly to get $500 more from the artist. Astonishingly, the contract the artists had signed even said that if they didn’t use the track and deliver a satisfactory song with it, that the artist would owe the label another $15,000 cash – the claimed value of the crappy 10 second sample.
Sadly, there was little we could do – trying to sue them would be “throwing good money after bad.” It is unlikely that the fake label would respond to a demand, and it was not cost effective for the artists to engage an attorney on an hourly retainer. We had to recommend that they contact the U.S. Postal Inspector and file a report, and to contact the local newspaper and television news’ consumer action hotlines to report the scam. These scams are common, and affect not only musicians but also songwriters – there are similar scammers who offer unheard beats or melodies for a price, take the songwriter’s money and send over a mediocre or ridiculously simple melody or beat (this is not to be confused with the legitimate beat retailers on the internet).
THINGS TO WATCH OUT FOR THAT SIGNAL A SCAM:
1. Offer of a record contract that asks YOU for money.
2. They ask for money in the form of a Western Union or MoneyGram.
3. They say they are also contributing a dollar amount towards your recording, with the words “value of $_____” – this doesn’t mean they are giving you that amount of actual cash benefit, but that their contribution has that supposed value. Really, it’s worth $0, but they say it is worth more.
4. Websites that list celebrities who wouldn’t seem to be affiliated with such an entity. If it seems fishy, it probably is.
5. People who hold themselves out as music industry experienced but become defensive when you probe their background and affiliations. Don’t be afraid to do background research on people before signing contracts with them.
6. People who promise the moon, especially to an artist who isn’t ready for a complete record deal.