Are you driving all 10 LEDs from pin 8? If so, you are definitely drawing too much current. The maximum is 40mA per pin. Even if they are on different pins, it's relatively much for the chip, since the recommended maximum current is 200mA for the entire chip, with an absolute maximum of 300mA. The 5V regulator on the Arduino board is only capable of delivering 500mA, so you may want to consider using a separate power supply for the speaker and the LEDs.
As for the sparking outlet, this is probably because there's some corrosion on the contacts, and not due to high current.