Over ninety per cent of software applications sold through major online auctions sites, such as eBay and Yahoo, are counterfeit, according to a new report from the Software & Information Industry Association (SIIA).

The Washington-based trade association conducted a review of 1,300 online software sales on auction sites. The review was conducted over a four-day period at the end of March and beginning of April.

The SIIA found that 91 per cent of auctioned software was pirated. Out of the 1,300 online software auctions that the SIIA monitored, only 138 contained legitimate software licenses. A similar review of auction sites in August found a 60 per cent software piracy rate.

Peter Burek, vice president of anti-piracy programs at the SIIA, said auctioneers can dramatically reduce pirated software sales on their sites by being proactive about monitoring auctions. According to the SIIA, Amazon monitors its sales closely and immediately removes illegitimate goods from the site. The SIIA didn't find any illegitimate software auctions on Amazon's Web site during its review, he said.

SIIA suggests consumers take precautions when buying software from an online auction. First, look for signs that the software isn't for purchase, such as having the terms 'not for resale,' 'back-up' or 'OEM' emblazoned on the packaging.

The organization also recommends looking for a complete set of documentation. If the manual isn't included, there may be a problem. Finally, if the price is too good to be true, it's probably pirated.

Yahoo declined to comment on the SIIA report because the company is facing a lawsuit from Electronic Arts, Nintendo and Sega regarding pirated games sold on its auction site.

The companies claim that Yahoo failed to remove illegal auctions from its site after being asked to do so. The firms are seeking an injunction against the company.

SIIA's Burek says Yahoo needs to be more vigilant in enforcing its usage terms and reducing counterfeit software sales on its site.

Burek says a simple way to curb pirated software sales is to prevent sellers from using terms like 'back-up,' 'CD-R,' or 'compilation CD' when describing software for auction. "Pirates are lazy and will go where it's easy to sell products, and right now, that choice of venue is going to be Yahoo," he says.