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First things first Don't Panic.

It wont damage your machine. I’m sure by this time almost everybody is now familiar with Windows Genuine Advantage ‘tattoo’ that identifies your illegal copy of Microsoft Windows product.
The annoying popup will nag you at login screen each time you boot up the computer.

To add to the shareware ‘look and feel’, a balloon popup will appear randomly when you use the computer, reminding the user that they may be a victim of (pirated) Microsoft Windows product.
However the windows tattoo is not without a flaw, few websites including The Inquirer has published ways to circumvent the Windows Genuine Advantage check by tampering with windows registry.
Presented here is an alternative way to remove those annoying popup
Go to C:\Documents and Settings\All Users\Application Data\Windows Genuine Advantage\data go to Tools->Folder Option->View,
select “Show Hidden Files and Folders” Uncheck “Hide Protected Operating System Files”, then click OK Delete everything in that folder Mark that folder as “Read-Only”, then you’re done!
The annoying windows popup won’t appear anymore!
Simple solution without having to temper with Windows Registry. Update - You can download WGAfakap
You can download an application that will automatically remove the annoying Windows Genuine Advantage Notification.