Workplace Piracy: Liabilities, Risks & How to Stop It

March, 30, 2017

By Shafraz Farook
In a global survey conducted by Business Software Alliance (BSA), Sri Lanka’s rate of unlicensed software installation stood at 79 percent in 2015[1]. In other words, 8 out of 10 people had installed software products that were either unlicensed or obtained illegally. In monetary terms, that’s a commercial loss of USD 163 million[2] to software manufacturers.

Under clause 178 of the Intellectual Property Act No. 36 of 2003 which refers to the infringement of copyrights, offenders shall be liable on conviction by a magistrate for a fine of up to LKR 500,000, or to imprisonment for a period of six months in jail, or even both[3].

Seven years ago, the CID established the Anti-Piracy and Counterfeit Unit (APCU). And since its inception, the unit has carried out a sequence of raids on a number of high-profile businesses suspected of infringing the intellectual property rights of software manufacturers such as Adobe and Microsoft.

Surprisingly, a business can still be at risk for using pirated software without even being aware of it. A frequent instance of unknown liability for business owners is when their IT manager or staff installs an illegal copy of Adobe Professional, under the assumption that they will remain legal because they only use it to read PDFs.

Besides the risk of raids and fines, which could easily disrupt a business’ finances and reputation, there are other reasons to avoid illegal software in the workplace. Software publishers offer their legitimate customers a wide array of services besides the program itself; these include support services, and upgrades. A legitimate copy or piece of software ensures that a purchaser is getting a quality product produced by the rightful software owner. In contrast, illegal or unlicensed copies provide none of these benefits.

Moreover, pirated software tends to subvert a computer’s security features, leaving it open to malware that could damage or compromise data, jeopardizing the security of a business’ computer network. Any one of these problems could quickly escalate into costly damages that become far more expensive than the money a business could have saved by buying or downloading unauthorized software.
Dirty Malware
Cyber security organizations have routinely stated that pirated software disrupts computer operations, gathers sensitive information, and displays unwanted advertising. What is malware? Let’s just say that it consists of highly dangerous backdoors, hijackers, droppers, bots, crackers, password stealers, and Trojans.

The BSA Global Software Report 2016[4] concluded that the higher the rate of unlicensed PC software, the higher the likelihood that it contained potentially debilitating malware. The finding was the result of a regression analysis, a statistical process for estimating the relationships among variables. The correlation coefficient of 0.78, provided in the report, indicated a very strong positive correlation between malware and unlicensed software.

Businesses need to address these risks and actively adopt policies that mandate the use of legal and licensed software. People with counterfeit software have no guarantee that their sensitive data, activities and communications will be safe from cybercriminals that intend to do harm. As the results of the studies and reports show, the danger of counterfeit software is real.

Purifying the Workplace of Piracy

If an employee installs an unauthorized computer program on company hardware or illegally downloads software from the Internet, the employer may be held liable — even if you or company management didn’t know this sort of activity was going on. This is one more reason why business owners should police their computers and have regular audits performed if they have any concerns.

For businesses trying to avoid piracy in the workplace; maintaining strict policies and disallowing the download, upload, or use of unlicensed intellectual property on company property is essential.
It is important to make employees take personal responsibility for the contents of their workstations and explain to them that if they don’t, the threat to your business could cost them their jobs as well.

On a purely ethical level, avoiding illegal software is just the right thing to do, because if you don’t then you’re stealing — plain and simple. Businesses need to understand that they need to act on this before it is too late. On the surface, the average person sitting at home and using an illegal program on their laptop doesn’t really care about the business down the street that’s getting raided and fined for pirated software. But they should, because this situation affects life as a whole in ways that people don’t see.

A low piracy rate is a sign of a healthy IT industry, which often translates to more jobs, more funds, and more taxes the government can collect to help improve other aspects of life throughout the country. Less piracy will directly affect the local economy in a positive way.



[3] (Pg. 138)