The world's largest record company, Universal, will pay out $12m (£6.3m) after an investigation into paying radio stations to play its songs.
Universal hired people to request songs by R&B singer Ashanti
New York Attorney General Eliot Spitzer alleged that the company provided computers, travel and concert tickets in return for airplay.
Record companies in the US cannot offer financial incentives under a 1960 law.
Sony BMG and Warner Music have already paid out under the investigation, and EMI is expected to follow soon.
The $12m settlement will be used to fund music education programmes.
In testimony to the attorney general's office, Universal executives admitted providing hotel rooms, concert tickets and money for promotions to radio stations in return for airplay.
The company was also accused of hiring people to manipulate phone-in request lines to exaggerate the popularity of songs by hip-hop artists Ashanti and Ludacris.
Making a mockery
Eliot Spitzer wants to stamp out corruption in the music industry
"Consumers have a right not to be misled about the way in which the music they hear on the radio is broadcast," said Mr Spitzer.
"Pay for play makes a mockery of claims that only the 'best' or 'most popular' music is broadcast."
Universal Music has not admitted guilt in the case, but said it had been working "co-operatively" with Mr Spitzer to make changes to its promotional activities.
"The reforms that we have agreed to with the attorney general are consistent with the policies that we voluntarily implemented over a year ago," said a Universal spokesman in a written statement.
Universal controls about 30% of the US music market, and owns labels like Motown and Island, which is home to U2.
Its roster of artists includes Bon Jovi, Eminem and Shania Twain.