Anti-Fraud Policy

For the purpose of this Policy, the “End User” will be the person or entity that contracts with us, accepting the Terms of Service, providing content that will be made available on DMS (that is, “Digital Music Services”). “We” or “Us” are the provider of the service, LA CUPULA MUSIC.

The purpose of this policy is to provide:

  • A clear definition of what we mean by “fraud”.
  • A definitive statement take distance of fraudulent activity in all its forms.
  • A summary to End Users of their responsibilities for avoiding fraudulent activities.
  • Guidance to all parties involved as to action which should be taken when we, the DMS or any other third party suspect any fraudulent activity.
  • Clear guidance as to responsibilities for conducting investigations into fraud related activities.
  • Protection to rightsholders in circumstances where they may be victimised as a consequence of fraudulent activities.

This document is intended to provide guidance and should be read in conjunction with:

  • The Terms of Use
  • The Privacy Policy

Table of Contents:

  1. Definitions
  2. Policy
  3. What DMS are doing about it
  4. What we are doing about it
  5. How we deal with suspected Fraud
  6. The consequences of Fraudulent use of our Platform or Services
  7. Severity, 3-Strike Policy and Blocking of Accounts
  8. Resolving a Strike
  9. Withholding Royalties (“Escrow”) for blocked accounts:
  10. Takedowns

Definitions

For the purpose of this policy, Fraud is defined as (but not limited to) the unauthorized exploitation of material protected by copyright (Copyright Infringement); the use of (modified) artist, band or label names or artwork which may create confusion or false expectations related to content which is served to consumers by DMS (i.e., Musical Spam); the 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; the upload of distorted music also to generate revenues and other unauthorized activities coming from disloyal users.

Policy

Fraud in all its forms is wrong, and is unacceptable to us.

This is because where fraud occurs:

  • It is not just a loss to us, but ultimately to other content creators, damaging their copyrights, reputation or reducing the royalty pool which is made available by the DMS to content creators.
  • It may have a major impact on our reputation, our contracts with DMS and therefore again on other End Users using our Services.

Our objective is that fraudulent usage of our Services is eliminated. Any indications of fraud will be rigorously investigated and dealt with in a firm and controlled way.

What DMS are doing about it

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

What we are doing about it

We are actively taking action in the following fields:

  • We are automatically monitoring (historic) sales data to combine this with other information (i.e., artist profiles, End User information, social media, etc.), to detect possible irregular activity.
  • Our entire back catalog and all new tracks are fingerprinted and matched against several databases to avoid multiple uploads of the same song, uploads of “white noise”, “empty songs”, upload of already copyrighted materials and, in general, any unauthorized activity.
  • Our quality control (QC) processes are designed to track down the use of metadata that can be misleading, resulting in Musical Spam or any other unauthorized activity.

How we deal with suspected Fraud

  • In case we detect or have suspicions of 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 the End User via a 3-strike policy system, resulting in blocking of the End User account in case our warnings are ignored.
  • We may block and retain revenues in any End User account that are received in connection with content that we believe, in our sole discretion, violate the Terms of Use or the agreements we have with DMS.
  • Blocked accounts can only be unblocked following the strict protocol described below.
  • In case an account is marked with potentially unauthorized activity, we are putting into practice a preventive account block or a 3-strike policy, warning the End User and, once the last strike is applied, we retain the payment of Royalties during 24 months of receiving the payment by DMS, in order to refund the suspiciously-generated payment to DMS, if necessary.

The consequences of Fraudulent use of our Platform or Services

  • If we deem that an End User is breaching the Terms of Use of the Service, we will have the right to terminate the contractual relationship and close the Account. Additionally, we will have the right not to renew the service agreement in our sole discretion.
  • We may recoup any amounts due to an End User from any DMS for any fraudulent or unauthorized use of the service by withholding such amounts from future payments due to an End User.
  • To the extent any fraudulent and/or infringing activities are determined to be caused by the End Users’ actions, any costs incurred by us or our providers (including legal fees and expenses) in connection therewith may, in addition to other remedies, be deducted by us from any future payments due to an End User.

Severity, 3-Strike Policy and Blocking of Accounts

Either during our QC process or during the sales confirmation process, our system may alert issues on possible fraudulent content or accounts.

We divide these issues into 3 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

F0 and F1: Critical issues related to an End User Account, Issues related to Click Fraud

Once possible fraudulent content or accounts are detected, End User Accounts will be blocked preventively in the following cases which we consider very severe:

F0: Applicable cases

  • One PayPal email address is linked to several End User accounts on the platform.
  • An End User has entered in his or her profile fake or incorrect information or audios that belong to a third party.
  • Repeated, inconsistent IP activity versus declared country of origin on an End User profile.

F1: Applicable cases

  • An End User account contains releases from unknown artists which are generating a considerable number of streams or views and subsequently, revenues in a short period of time without a minimum fanbase (listeners or viewers) to support it.
  • Any sudden uplift in sales without corresponding numbers in profile views or social media to support it.
  • An account generating royalties without having any detailed customer information.

F2: Issues related to Musical Spamming and Copyright issues

F2: Applicable cases

An account receives a strike when one or more of the following problems are detected:

  • A release contains compound artist names, using (a mix of) famous artist names added to the release in order to attract consumers to click.
  • A release contains copyrighted material from someone who is not the Account holder.
  • We received a content infringement ticket from a DMS.

In case we detect one or more of these factors in an End User account, the End User will receive a ticket or notice, indicating we have detected potential infringing or unauthorized activity and the corresponding account is blocked preventively while information from the End User is required.

Unblocking an account

In case an End User provides the requested information within 5 working days, and the information can be verified, the account can be unblocked.

We may request End Users to take the following steps in order to unblock the account:

  • The End User information must be fully completed.
  • The End User has to send us a copy of an identification document (passport or national ID).
  • In most cases we also request artist profiles, website urls, , Twitter, Facebook, Instagram, etc., profile information from the artist in order to contrast this with the sales data. These profiles must have historical data to support the sales data.

Blocked account policy

  • In case an End User cannot, or refuses to provide the requested information within 5 working days, we may block and withhold revenues in any End User account that are received in connection with content that We believe, in our sole discretion, violate our Terms of Use or the agreements we have with DMS.
  • End Users with blocked accounts will not be able to access the platform and, therefore, enjoy our services.
  • All End User content is taken down.
  • The money is kept in escrow until a timeframe of maximum 24 months has passed.
  • If during these 24 months, there have not been any disputes or claims by DMS or third parties, the funds will be released and transferred to the End User.

Three strike Policy

In case We detect an F1 or F2 issue in an End User account, a strike is applied to the account and the End User which uploaded the content will receive a ticket or notice, indicating we have detected potential infringing or unauthorized activity and additional information from the End User may be required.

In case an End User cannot or refuses to provide the requested information within 5 working days, a Strike will be applied to the account. We can apply up to three strikes which have the following consequences:

STRIKE 1:

  • End User is informed.
  • Takedown of questioned content.
  • Warning of delay on 2nd strike and block on 3rd strike.

STRIKE 2:

  • End User is informed.
  • Takedown of questioned content.
  • 15 Day process delay on all account content.
  • Warning that account is blocked on the third strike.

STRIKE 3:

  • Client is informed.
  • End User account is blocked.
  • All End User content is taken down.
  • Royalties will be kept in escrow for 24 months.

Once an End User has received three Strikes, we will block the End User’s account.

Resolving a Strike

Once a Strike has been applied, we may request End Users to take the following steps in order to release the strike and reduce the risk of blocking their account and/or takedown of the uploaded tracks:

  • Correcting the release metadata.
  • In case there is doubt about the ownership of the uploaded tracks, the End User must provide proof of this, by sending us a license, contract or ownership certificate.
  • Acquiring the applicable licenses.

In case We deem, at our sole discretion, that the provided information suffices, the Strike will be resolved. In case the information requirements are not met, the Strike will be applied.

Withholding Royalties (“Escrow”) for blocked accounts:

  • We may block and withhold revenues in any End User account that are received in connection with content that We believe, in our sole discretion, violate the Terms of Use or the agreements We have with DMS.
  • The money is kept in escrow until a timeframe of maximum 24 months has passed.

The royalties will be held in escrow in order to be able to respond in the following situations:

  • An End User proves his account is not fraudulent and, therefore, royalties will be made available to the End User.
  • We receive claims from DMS, asking for a refund of the royalties in case any DMS deems it was generated through unauthorized or fraudulent activity. Please note that DMS contractually have the right to reclaim royalties during a timeframe of 24 months, that is why we need to respect this period as well.
  • We receive claims from legitimate rights holders, claiming the payout of the royalties that have been retained, plus royalties that already have been paid to End Users with claimed unauthorized or fraudulent activity.

Takedowns

We will only initiate takedowns of suspicious content for blocked accounts and all content that is involved in F0, F1 or F2 issues.

However, please also note that any content may be marked as suspicious by DMS at their sole discretion and may be taken down at their discretion.

(prod / master / da021a280ead920549284097feff691d3075ad84) Release Sinn Sing Hoi (0_00077)