The Business Software Alliance (BSA) has refuted claims that rewarding people for passing on information about software piracy offences puts it in breach of the Bribery Act.
The anti-piracy body offers rewards of up to £10,000 in exchange for information that leads to the discovery of pirated software products or licence misuse. UK firms caught in its net in 2010 coughed up £2m in direct costs, double the previous year's total.
The UK's piracy rate has remained frozen at 27 per cent for the last five years and the BSA claims a ten per cent drop in that figure would create 13,000 jobs in the technology sector.
ChannelWeb was recently contacted by an anonymous source who claimed the BSA's whistleblowing rewards scheme may result in it falling foul of the Bribery Act legislation.
In a statement to ChannelWeb, a spokesperson from The Crown Prosecution Service, said it would be difficult to see how offering rewards in exchange for information on criminal acts could be considered an offence.
In order for someone to be prosecuted for Bribery Act offences, the statement reads, a financial reward must be offered to induce a person to "perform improperly a relevant function or activity" or be given to someone in response for an "improper performance of such a function or activity".
"In a case where there was sufficient evidence for a realistic prospect of a conviction, we would still have to consider whether it was in the public interest to prosecute someone," it concludes.
Even so, ChannelWeb's source, who agreed to speak under the condition of anonymity, said there could be instances in which "whistleblowers" have installed pirated software on their employer's computers to bag a reward from the BSA.
In such a case, the BSA would be in clear breach of the Bribery Act, the source claimed: "It is my belief that the prospect of a financial reward could result in the corruption of an individual, a disgruntled employee or someone who knows they are at risk of redundancy."
Julian Swan, director of compliance marketing for EMEA at the BSA, hit back, claiming that blowing the whistle on illegal conduct is never improper.
"We do not pay rewards unless software piracy or infringement is found and rewards are only ever paid when a case is successfully concluded," he said.
"We carefully vet all our leads before sending any legal letters regarding illegal software use, because our programmes are designed to elicit and reward reports of illegal conduct only, and not false reports filed with malicious intent. We are confident there is no breach of the legislation."
In a separate allegation, the BSA has also been accused of using its enforcement powers to unfairly target small businesses that have neither the legal nor the financial resources to fight back.
Swan dismissed the notion that targeting SMBs was part of the BSA's business or commercial strategy, citing its 2009 case against private members' club Soho House. "It is down to the leads we receive. We respond to where the leads are pointing. There is absolutely no deliberate targeting involved," he said.
He also denied claims that the BSA takes action against firms based on "spurious" information, in the hope of uncovering infringements that would allow it to demand a settlement payment.
"The majority of leads we receive are not acted on at all, because there is no grounds to do so. Each one is meticulously vetted and checked before embarking on legal action," explained Swan.
"It is worth remembering that lawyers' time does not come cheap, so it would not make financial sense for us to have people constantly running around in the hope of securing a settlement."
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