Microsoft EMEA coordinates crack down against Internet crime

Microsoft EMEA in coordination with national enforcement agencies has announced a significant global crackdown operation against Internet software piracy and fraud with criminal actions taken in 22 countries worldwide. Microsoft has sought the immediate removal of the alleged counterfeit offerings - bringing the total number of Web takedowns to 38 065 in the last eight months.

Since January 2000, Microsoft has been awarded $17.7 million in settlements and judgements.

"Since last August`s global sweep, nearly five million units of counterfeit Microsoft software and hardware were seized worldwide, with an estimated retail value of over US$1.7 billion. A dramatic increase from last year," said Sharon Golec-Keniger, corporate attorney for Microsoft EME, responsible for Internet piracy.

"Microsoft has put significant resources behind its global anti-counterfeiting efforts. We`re also working cooperatively with industry partners, business organisations, and Internet service providers to help protect consumers and to bring counterfeiters to justice."

There has been a significant change in the counterfeit software distribution model, allowing international counterfeiters to more easily market and distribute smaller quantities of counterfeit software directly to consumers.

Counterfeiters aim to work under the radar of law enforcement authorities by exploiting the Internet`s anonymity.

"Counterfeiters are increasingly using the Internet as a distribution vehicle for counterfeit software and other products all over the world," said David Finn, corporate attorney for Microsoft EMEA.

"Under the leadership of career criminals and well-known organised crime gangs with international ties, the counterfeit software trade is flourishing - and so are the more nefarious activities of these criminals, such as drug running and terrorism, that counterfeiting is helping to fund."

There have been a total of 79 091 removals of illegal product offerings on the Internet since March 1999 when Microsoft developed its Internet Monitoring Tool, which operates 24-hours-a-day, 7-days-a-week. February 2001 alone produced over 6 430 takedowns and an average of 4 758 are being removed monthly.

Below is information on criminal actions taken in the European region. Please see the end of release for more detail on cases internationally.

United Kingdom: Late last month, a London jury convicted a criminal ring responsible for a multimillion dollar international counterfeiting racket. The gang specialised in trading counterfeit Microsoft software internationally and is suspected to have sold millions of pounds worth of counterfeit software. The racketeers, who relied on various hard-core criminal tactics, bundled counterfeit disks imported from Asia with genuine Certificate of Authenticity (COA) labels obtained in the armed robbery of a Scottish printing factory.

In November 2000, as part of its global "Operation Bidder Beware" sweep, the Business Software Alliance filed and served three sets of legal proceedings in the UK against suspected suppliers of counterfeit software. Those suppliers were using the auction site www.qxl.com to advertise their products for sale, and are believed to have sold numerous copies of counterfeit software through the auction site.

Germany: In March 2001, Microsoft sent 30 cease and desist letters to targets that sold counterfeited software or burned CD-Rs on auction sites including, IEZ Auktionen, offerto.de, Ricardo.de.

In November 2000, a software pirate near Frankfurt sold illegal software to a police officer. The police raided the target`s home and seized six PCs, 10 burners, and approximately 1 000 gold CD-Rs. The target was arrested. Since January 2001, Microsoft has filed five criminal complaints against additional targets that have allegedly sold counterfeited software or burned CD-Rs through auction sites in Germany.

Hungary: In October 2000, law enforcement raided an alleged counterfeiter who distributed BSA member company software products over the Internet. During the raid the police seized CDs containing software applications from Adobe, Autodesk, Corel, Microsoft, Symantec and other products. This case led to the police conducting a raid of another pirate`s operation where they seized more than 1 000 CDs containing various software publishers` software.

In November 2000, law enforcement raided an alleged counterfeiter in Hodmezovasarhely who published a software program list on the Internet. The police seized nearly 10 000 compilation CDs with illegally copied software products.

Poland: In November 2000, law enforcement, with the assistance of the Business Software Alliance, raided the home of an individual in Poznan, who was allegedly distributing software over www.cdzone.prv.pl.

In November 2000, a District Court in Wroclaw found a software pirate guilty of selling illegal copies of Business Software Alliance member company software products over the Internet. The accused was ordered to pay a fine and court fees. This is the first judicial decision against an Internet software pirate in Poland.

Romania: In October 2000, Sibiu Police raided the home of an individual, Manea Bogdan, who was allegedly distributing illegal software over the Internet using three different sites, including www.megaone.com/oferta. The police found approximately 350 illegal CDs containing Adobe, Autodesk, Corel, Microsoft, and Symantec programs. They also found illegal software on the defendant`s computers as well as a list of the defendant`s customers.

Consumers, both knowingly and unwittingly, often become victims of piracy and online fraud by purchasing software that turns out to be counterfeit. In some cases, consumers who order products over the Internet never received anything at all, while in others they received a defective CD or a download infected with a virus. With an upsurge by over 500% in consumer complaints in the past eight months to Microsoft`s EMEA hotline regarding counterfeit goods purchased online, it`s important for consumers to be smart shoppers and learn to spot the warning signs of pirated software on the Internet and be aware of the risks that accompany it.

Consumers are not the only victims of counterfeiting. Creators of software and other intellectual property content are increasingly disadvantaged by an Internet mentality that does not respect their rights to protect their own ideas from being illegally copied.

"As the courts have indicated with the recent Napster ruling, the importance of protecting intellectual property in today`s digital age cannot be underestimated," said Debbie Walsh, anti-piracy manager for Microsoft EMEA. "As distribution models change and more content moves to the Internet, it is critical that we continue to take steps to protect creators` intellectual property rights and foster broad economic growth."

Microsoft is committed to the development and implementation of technology solutions that both disseminate and protect intellectual property on the Internet. As more emerging technologies continue to make it easier to distribute pirated products online, it is imperative that content and service providers work together to provide consumers with legitimate online content and improve ways to access and distribute copyrighted works legally.

For tips on how to shop safely for software online, visit Microsoft`s Anti-Piracy Web site at www.microsoft.com/piracy. If you have questions about software piracy, if you suspect your Microsoft software is counterfeit or in some other way illegal or if you suspect a person or a company of using or selling illegal software, you can call the Microsoft Anti-Piracy Hotline in your country. For numbers for your country please call the English number on 0800 013 2222 or send an e-mail to piracy@microsoft.com.