The Business Software Alliance (BSA) has extracted $425,000 from two companies for unlicensed software use.

Payless ShoeSource paid BSA $124,057 to settle claims that it had unlicensed copies of Adobe, Autodesk, Borland, Internet Security Systems, McAfee and Symantec software programs installed on its computers. And Burlington Coat Factory Warehouse paid the BSA $300,000 to settle claims that it had unlicensed copies of Microsoft and McAfee software programs on its computers.

"Burlington Coat Factory understands the importance of software asset management," the retailer's CIO, Brad Friedman, said in a statement. "We have created a new software management policy and continue to refine its implementation to emphasize the importance of understanding each software company's licensing requirements and using only fully licensed software. We also note that when these issues arose, effective corrective action was taken as soon as they came to management's attention.

"We are confident that all our software has been fully and appropriately licensed since then," Friedman said.

Both companies also agreed to delete any unlicensed copies of programs in use, purchase replacement software and strengthen their software management practices.

"BSA recommends that all companies and organizations have strong software management policies in place - including periodic internal audits, guidelines for supervisors and clear procedures for employees," Jenny Blank, director of enforcement for the BSA, said. "We hope this settlement will set an example to other businesses that software should be managed just as carefully as any other more tangible asset."

Most investigations begin with a call to the BSA's hotline or with a report to BSA's online reporting form by current or former "disgruntled" employees who are unhappy with their employers and see no reason to keep the secret any longer, Blank claimed.

The BSA received reports on Payless and Burlington Coat Factory through the online reporting form, she said. Both companies then co-operated with the BSA and conducted self audits.

The BSA said it is now offering rewards of up to $200,000 for qualifying reports received via its hotline or online reporting form.