Near-perfect knockoffs of 21 different Microsoft programs began surfacing around the world just over a decade ago.
Soon, PCs in more than a dozen countries were running illegal copies of Windows and Office, turning unwitting consumers into criminals and, Microsoft says, exposing them to increased risk of malicious viruses and spyware.
The case began to turn in 2001 when US Customs officers seized a shipping container in Los Angeles filled with US$100 million in fake software, including 31,000 copies of the Windows operating system.
From there, Microsoft pushed the investigation through 22 countries. Local law enforcement officials seized software, equipment and records and made arrests. A court in Taiwan handed down the last of the major sentences last month. Microsoft estimates the retail value of the software the operation generated at US$900 million.
"That is a tremendous accomplishment," said James Spertus, a former federal prosecutor in Los Angeles who later led anti-piracy efforts for the Motion Picture Association of America. "There are only going to be a few cases like this a decade."
Now Microsoft is eager to talk about the experience because taking down that operation -- responsible for about 90 percent of the fake software the firm found between 1999 and 2004 -- didn't actually stop piracy. It just left room for more counterfeiters to rise. Microsoft hopes would-be pirates will think twice if they know how far it will go to protect the computer code worth billions in revenue each quarter.
The pirates mimicked complex holograms stamped directly onto disks and packaging materials embedded with the kind of tiny safety threads used in making money. In some cases, it took experts with microscopes to notice that disks printed with codes used by legitimate software factories lacked certain minuscule, unique smudges.
"The copies were so good, we went to tremendous forensic and scientific lengths to establish that the counterfeits were, in fact, counterfeits," said David Finn, an associate general counsel at Microsoft.
Without a solid lead on the source, Microsoft continued to gather string. Members of its 80-person worldwide anti-piracy team made test buys to see if retailers were selling fake disks, knowingly or unwittingly, and worked leads back up the black-market supply chain.
The seizure of the container in Los Angeles led to Taiwan, where the Ministry of Justice raided Chungtek Hightech Enterprise Ltd (中帝科技), recovering an estimated US$100 million in software and equipment. Months later, Taipei City police and other investigators hit Cinway Technology Co (碧盈科技), a related manufacturer in the same industrial complex, seizing another US$126 million in phony software. Records found there led to a packing, storage and shipping center in China's Guangdong Province and back to distributor Maximus Technology Inc (鈞富資訊) in Taiwan.
Finally, last year, the owner and operator of Chungtek and Cinway, Chen Bi-ching (
China's Public Security Bureau raided the packing and shipping company, Zhang Sheng Electronics (展聖電子), and Li Jian, the manager, was sentenced to three years in 2004.
Matching the Taiwanese counterfeits to copies found around the world, Microsoft gave law enforcement agencies ammunition for raids and criminal cases in the US, the UK, Italy, Canada, Germany, Singapore, Australia, Paraguay and Poland. Dozens of big distributors, middlemen and retailers were convicted, including 35 people in the US.
One was Lisa Chen, who according to a Customs press release arrived at the scene of the 2001 shipping container bust with additional counterfeit software in her vehicle. Chen was prosecuted by the Los Angeles district attorney's office as a major US distributor of the Taiwan-made fakes and received a nine-year prison term in November 2002. She has since been released, her lawyer at the time said.
Microsoft would not say how much it spent on the investigation or how many counterfeit copies of Windows and other programs were found in use on PCs.
After the raids in Taiwan, the number of high-end Microsoft counterfeits dropped -- but only for a while. A Chinese operation that stepped in cranked out an estimated US$2 billion in copies before it was brought down last July.
DEFENDING DEMOCRACY: Taiwan shares the same values as those that fought in WWII, and nations must unite to halt the expansion of a new authoritarian bloc, Lai said The government yesterday held a commemoration ceremony for Victory in Europe (V-E) Day, joining the rest of the world for the first time to mark the anniversary of the end of World War II in Europe. Taiwan honoring V-E Day signifies “our growing connections with the international community,” President William Lai (賴清德) said at a reception in Taipei on the 80th anniversary of V-E Day. One of the major lessons of World War II is that “authoritarianism and aggression lead only to slaughter, tragedy and greater inequality,” Lai said. Even more importantly, the war also taught people that “those who cherish peace cannot
STEADFAST FRIEND: The bills encourage increased Taiwan-US engagement and address China’s distortion of UN Resolution 2758 to isolate Taiwan internationally The Presidential Office yesterday thanked the US House of Representatives for unanimously passing two Taiwan-related bills highlighting its solid support for Taiwan’s democracy and global participation, and for deepening bilateral relations. One of the bills, the Taiwan Assurance Implementation Act, requires the US Department of State to periodically review its guidelines for engagement with Taiwan, and report to the US Congress on the guidelines and plans to lift self-imposed limitations on US-Taiwan engagement. The other bill is the Taiwan International Solidarity Act, which clarifies that UN Resolution 2758 does not address the issue of the representation of Taiwan or its people in
The Philippines yesterday criticized a “high-risk” maneuver by a Chinese vessel near the disputed Scarborough Shoal (Huangyan Island, 黃岩島) in a rare incident involving warships from the two navies. The Scarborough Shoal — a triangular chain of reefs and rocks in the contested South China Sea — has been a flash point between the countries since China seized it from the Philippines in 2012. Taiwan also claims the shoal. Monday’s encounter took place approximately 11.8 nautical miles (22km) southeast” of the Scarborough Shoal, the Philippine military said, during ongoing US-Philippine military exercises that Beijing has criticized as destabilizing. “The Chinese frigate BN 554 was
LEISURE: The new law adds Confucius’ birthday, the anniversary of the Battle of Guningtou, Constitution Day and Little New Year as national holidays The Legislative Yuan yesterday passed new legislation adding four national holidays and making Workers’ Day a national holiday for all sectors. The Chinese Nationalist Party (KMT) and the Taiwan People’s Party used their combined majority in the legislature to push the jointly proposed draft through its third and final reading. This new law supersedes the existing regulations for the implementation of memorial days and state holidays, which are administered by the Ministry of the Interior. The new law recognizes Confucius’ birthday on Sept. 28, the anniversary of the Battle of Guningtou on Oct. 25, Constitution Day on Dec. 25 and “Little New Year,”
RSS