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Quite how the system, codenamed Operation Tracker, works will remain a closely guarded secret, but its primary aim is clear: to find companies where software is being illegally downloaded. Although uploaders will be targeted if they are found to be hosting large amounts of software, they will not be the priority.

FAST's director general, John Lovelock, said that there is currently a 'complacency on behalf of UK directors' about the problem, with many unaware that having stolen software can result in large fines or even imprisonment. Newspaper publisher The Mirror Group was famously fined £1m several years ago when a FAST audit revealed the presence of large amounts of unlicensed software.

Lovelock said that although £5m worth of software has been found in the past five years, this is only

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the tip of the iceberg. FAST is hoping that Operation Tracker will identify much larger pools of illegal software than is being swapped over the Internet, by identifying those companies that do not keep a strict check on what their employees are installing.

Many directors believe that corporate firewalls are sufficient to ensure they remain legal, but Lovelock said that such provisions are easy for downloaders to circumvent.

Lovelock said that it is the smaller developers who suffer the most - 'it's the small guys that get blown away' - and suggested that this is a barrier to many even entering the business. Larger companies have invested heavily in registration and authorisation technologies designed to prevent piracy although that has not prevented their applications from becoming available in large quantities.

'Corporate liability is something that management cannot afford to gloss over - it will come back to bite them. In the case of misuse of software, directors cannot plead ignorance - if their staff are using the corporate network for illegal activity, those in charge may be liable,' Lovelock said

'We would like employees to think carefully about downloading copies of software without paying for it. However the responsibility for their actions can rest with the directors and officers of their organisation. Theft is theft and will be treated accordingly.'