The controversial system collected the URLs of websites visited by its customers and the ISP failed to inform either its customers or the ICO before its launch.

Mark Schmid, TalkTalk’s Director of Communication said in a statement “We were simply looking at the urls accessed from our network, we weren’t looking at customer behaviour so we didn’t feel we were obliged to inform customers.  This is all about protecting customers. It is not designed to provide us with data for any other purpose.”

The system scanned the websites visited by TalkTalk customers to aid the company in detailing websites that could contain malware or viruses.

British Telecom had proposed a similar service called Webwise which was heavily criticised by the British public.  BT also conducted trials without informing customers which led to accusations of intercepting private data.

Online privacy is an issue of which the public is becoming increasingly aware, which can only be a positive thing.

The act was one fo the last  actions of the UK’s Labour government before the general election last may that saw them thrown out by British voters in favour of a Conservative / Liberal Democrat coalition.  It was controversial legislation that many felt was rushed through parliament without proper scrutiny.

The act allows for the disconnection of persisten illegal file sharers from the Internet, and rights for copyright holders to block websites sharing illegal content.

Critics including TalkTalk said that the new law would potentially criminalise the innocent who, due to the complexity of computers and network security, may not be aware of someone else in their property sharing files and who may accidentally leave their wireless network open to abuse by others.

Under thelegislation, persisten file sharers would be placed on a blacklist, a copy of which could be shared with copyright owners.

The current government has the right to repeal any previous legislation and, during the election campaign, deputy prime minister Nick Clegg said that the Digital Economy Act “badly needs to be repealed”.

Despite this the coalition told the BBC it has no plans to repeal it.

“The Digital Economy Act sets out to protect our creative economy from the continued threat of online copyright infringement, which industry estimates costs the creative industries, including creators, £400m per year,” read a statement from the Department of Business, Innovation and Skills.

“We believe measures are consistent with EU legislation and that there are enough safeguards in place to protect the rights of consumers and ISPs and will continue to work on implementing them.”

“We developed a BitTorrent client that free rides on BitTorrent, that is, it downloads from BitTorrent swarms without contributing any resources itself which illustrated that the BitTorrent protocol currently fails to prevent uncooperative behavior as it does not provide any countermeasures against free riding clients.”

It seems that Bitthief does not only prevent fair sharing but also spies on the users that use the client. Torrentfreak that Bitthief is currently collecting “the torrent hash, total size of the download, the current version of the client, total number of pieces available, and the size of these pieces” which can be clearly linked to the users IP address making it very easy to idenfity all activity of a certain user.

Everyone who is thinking about using Bitthief should be really cautious and consider this before using it. No one knows at this time why the developers are collecting the data which should make everyone at least suspicious.