Charles Cole Indicted for Fraudulent Acquisition of 239 Million Napster Shares

On June 11, 2026, federal prosecutors in the Southern District of New York announced that Charles Cole, a 57‑year‑old Mooresville, North Carolina, faces charges of wire fraud, conspiracy to commit wire fraud, and conspiracy to commit securities fraud. The indictment claims that, between June 2024 and March 2026, Cole engineered a scheme that allowed him to secure 239 million shares of Infinite Reality— the company that bought the Napster streaming service in March 2025.

According to the complaint, Cole and his associates fabricated bank statements, launched a counterfeit website that posed as a foreign financial institution, and sent forged letters to Infinite Reality. The documents were designed to convince the firm that Cole controlled billions of dollars and was ready to invest heavily. If convicted, the charges could carry up to 20 years for wire fraud, another 20 years for the wire‑fraud conspiracy, and five years for the securities‑fraud conspiracy.

Infinite Reality, which rebranded as Napster after the acquisition, had announced a record‑breaking $3 billion Series A in January 2025, elevating its valuation to roughly $12.25 billion. In November 2025, the company clarified that the promised investment would not materialize and labeled the incident a “victim of misconduct.” The new indictment confirms that the alleged fraud targeted the company’s share structure.

Napster’s trajectory has shifted dramatically over the past year. The music‑streaming service, operating under the Napster name since 2016, shut down in early January 2026. The brand was relaunched as an AI‑first platform that replaces licensed label catalogs with generative audio and offers real‑time music‑creation tools. While the pivot aligns with a broader industry trend toward generative AI for music production, it also places the company in a more precarious position as it rebuilds its user base.

The indictment does not contain a response from Napster or Infinite Reality. Industry observers warn that the company’s share price and investor confidence could be affected, especially given the recent pivot and the loss of a $3 billion investment that never came to fruition.

At this stage, the legal proceedings are in their infancy. The indictment is a public record, and the case will move forward in federal court. No sentencing has occurred, and the company has not announced any immediate operational changes in response to the charges.

The situation remains fluid. The outcome of the federal case could shape Napster’s future strategy, its ability to attract new investment, and its standing within the broader music‑technology ecosystem. Until a court decision is made, the company’s next steps remain uncertain.