During roughly the same time period I worked for a company with similar practices. When a director realised what was going on, and the implications for personal liability, I was given the job of physically securing the MSDN CD binder, and tracking installations.
This resulted in everyone hating me, to the extent of my having stand-up, public arguments with people who felt they absolutely needed Visual J++, or whatever. Eventually I told the business that I wasn't prepared to be their gatekeeper anymore. I suspect practices lapsed back to what they'd been before, but its been a while.