Just over a week ago, over a year and a half after it was first uploaded to YouTube, a video by an obscure soul singer called Milky Edwards suddenly started to go viral. The clip features a faceless record collector taking what he describes as a "hard to find" vinyl copy of Starman by Milky Edwards and the Chamberlings out of its sleeve and placing it on his record player. A reassuring crackle follows the needle hitting the wax and then the song begins: an introduction seemingly lifted from You Keep Me Hanging On by the Supremes, a "huh!" worthy of Edwin Starr at his peak, and then a supercharged, hand-clapping, foot-stomping, gospel soul cover of David Bowie's Starman that knocks the original into the next solar system.

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In the right-hand column beside the video lurked two more cuts from the album, both Bowie covers: Soul Love and Moonage Daydream, also given a righteous soul makeover. And peering closely at the album cover displayed on the minimalist Milky Edwards website, it appeared the record featured every song from Ziggy Stardust and the Spiders From Mars, presumably injected with the same irresistible fervour. On YouTube, the comments were delirious. "Awesome! Sounds like this has come from another dimension. Somewhere out there is a black David Bowie with a successful soul music career!" raved one new convert, while another summed up the rest of the posts with a simple: "I want this!"

Further investigation, however, turned up a surprise. The crate-digging forums had been aware of the video for months, unsurprisingly, and the general consensus among the soul and funk fanatics was that the Milky Edwards album was a hoax. The recordings felt "treated" rather than authentic, and the cover art – highly reminiscent of the 1968 Supremes album Reflections – was in a style that would have fallen out of fashion by the early to mid-1970s. And one sleuth had spotted that the font on the cover was a modern one – Mojo Standard. Graphic designer Brian Borrows, who used the font on the cover of What It Is Y'All by Senor Soul, which was released in 2002, agrees: "Yes same font. They've even squished and pulled it like mine – this can only be done on a computer. In the 70s, everything was pretty much done by hand. My gut tells me that the Milky Edwards sleeve was created on a Mac."

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So it's definitely a fake. Which just leaves the obvious question: why? What could possibly be gained from recording such spectacular cover versions and then pretending that they were actually from the 70s? Someone had even gone to the trouble of posting a YouTube comment in February of this year that Milky Edwards and the Chamberlings had been signed to Mercury, but the singer had become a Satanist and committed suicide, at which point the label deleted most of the band's back catalogue. All very entertaining, but it didn't succeed in generating interest – at that point, the videos had been viewed 600 or so times. This was a scam that was being ignored.

You don't have to look very far back through pop history to find a similar con-trick that worked very well from the outset. In 2006, Interscope released Make Believe, a "lost" album from 1974, by a band called Platinum Weird, which was supposedly a collaboration between Dave Stewart and a singer/songwriter from New York called Erin Grace. Interscope's marketing team had a slightly larger budget than Milky Chambers', and the hoax was supported by a slew of fake fan websites and videos of Mick Jagger, Ringo Starr and Stevie Nicks reminiscing about the band. By the time it emerged that Platinum Weird was actually Stewart and contemporary songwriter Kara DioGuardi, and that Starr had drummed on two tracks on the album, it was already a hit.

But not every hoax of this nature is simply an elaborate marketing stunt. When Cliff Richard released a white-label dance remix of his single, Can't Keep This Feeling In, under the name Black Knight in 1998, he was trying to sneak past what he thought was an unofficial radio ban of his music. And he succeeded. London dance station Choice FM played the track for four days before the penny dropped. "If we knew it was by Cliff, we would never have played it," admitted Choice DJ Jerry Bascombe at the time, "so it proves his point." In 2004, the Alarm repeated the trick by releasing a song as the Poppy Fields. It was the band's first hit in more than a decade.

There can be a lot riding on a successful music hoax: a career might be extended, or a newcomer might blag their way into the music industry (a fake Radiohead song gained Toronto songwriter Christopher Stopa 15 seconds of internet fame). But not every record hailed as a con turns out to be a work of fiction. When Livin' Love, the sublime album by 1960s girl group the Feminine Complex was first reissued in 1996, it was dismissed by a few critics as the work of "latter-day pranksters", supposedly "indie luminaries" dabbling with the girl group sound. As the review in Uncut later put it: "Could a Nashville girl group really be this good and remain undiscovered?" But fans went on to track down photographs of the band and genuine eyewitness accounts of their gigs, and this story of the hoax-that-wasn't-a-hoax has given a "what if?" sparkle to every scam attempted since.

So maybe the Milky Edwards album isn't a fake after all. Could the sleeve be modern but the music genuine? And, ultimately, does it really matter whether it's "4 Real" or not? The Milky Edwards fans on YouTube certainly don't think so. "I don't care if it's a hoax, this is fantastic," enthuses one. "I need the whole album," agrees another. And David Bowie's official Facebook page doesn't care about its authenticity either. "Sadly, the evidence points to this actually being a modern day hoax and that Milky Edwards and the Chamberlings never really existed," ran a statement last week. "But don't let that put you off. The three tracks available on YouTube are still well worth a listen and let's hope that whoever is behind this deceit gets around to recording the rest of the album soon. We're looking forward to Rock'N'Roll Suicide with a Detroit Emeralds twist and Star in the style of the Temptations."

And, of course, there's still the possibility that this is an established artist toying with the system. The name that comes up again and again on the forums and on YouTube is Tom Jones. He certainly had the raw soul power back in the day, as northern soul classics such as The Lonely One and Hide and Seek inarguably prove. And whoever's singing the Milky Edwards covers does sound spookily like Jones at full tilt. Alas, Jennie Harris of Jones's management, Valley Music, says we're pinning our hopes on the wrong Starman. "It's definitely not Tom Jones," she confirms. So who is behind this curious mystery? Perhaps now the videos have finally gone viral we'll find out. Will the real Milky Edwards please stand up?