A software pirate is facing up to 10 years in prison after Trading Standards officials from Derby City Council raided his home in Hull and found more than 300 pirated discs and computer equipment.

Michael Walton was caught selling illegal copies of StruCad modelling software created by UK software developer AceCad Software.

StruCad is used to create drawings of structural steelwork and was used in the design of Wembley Stadium's sliding roof and the 'Gherkin' building in London.

The software sells for between £13,000 and £20,000, but by cracking the encryption code Walton was able to copy the program and was selling it on eBay for as little as £12.

Wayne Rawson, director and general manager of AceCad, said: "International pop stars might be able to afford people copying their work, but we cannot.

"We are lucky in that we managed to stop this before too many copies had been sold. If it had carried on, we could have lost a fortune and may have had to lay off staff."

The piracy was discovered when Paul Bettany, one of AceCad's sales consultants, came across the auction while searching for a gift for his girlfriend.

Rawson reported the discovery to Derby City Council's trading standards department, which raided Walton's home with the help of Humberside police. Among the evidence were records of eBay payments from previous sales.

The Business Software Alliance (BSA) has hailed the action as a victory, and urged Trading Standards to take a tough stance against online sellers who deceive end-users and fuel the demand for copied software.

"Software piracy does not just affect multinational and well-known brands. This latest case underlines the negative impact it can have on smaller specialist UK companies," said Najeeb Kahn, vice chairman of the BSA.

"Auctions have developed into a marketplace where sellers feel they are anonymous and out of the reach of law. This case proves them wrong.

"Revenues lost to piracy, which are currently running at $1.67bn a year, are vital to the success and survival of many local developers like AceCad."

Walton pleaded guilty to charges under the Copyright, Designs and Patent Act 1988 and the Trademarks Act 1994. He is to be sentenced on 1 February.