ISPs become "judge, jury and executioner", according to rights group.
Five of the major ISPs in the US have begun a 'Six Strikes' policy against users they deem have committed copyright infringement.
The system is the brainchild of the Center for Copyright Information (CCI). This umbrella organisation comprises of five of the US's biggest ISPs - AT&T, Cablevision, Comcast, Time Warner Cable and Verizon as well as the Recording Industry Association of America (RIAA) and Motion Picture Association of America (MPAA).
The system works by serving suspected copyright infringers warnings. After six such warnings, ISPs will limit but not cut off a suspect's internet access.
"Our content partners will begin sending notices of alleged peer-to-peer copyright infringement to ISPs, and the ISPs will begin forwarding those notices in the form of copyright alerts to consumers," CCI's executive director Jill Lesser said in a blog post.
"Most consumers will never receive alerts under the program. Consumers whose accounts have been used to share copyrighted content over P2P networks illegally (or without authority) will receive alerts that are meant to educate rather than punish, and direct them to legal alternatives," she added.
However, civil rights groups have branded the scheme tantamount to ISPs acting as "judge, jury and executioner".
"These mega-corporations now claim the authority to undermine your Internet access - and want to serve as judge, jury, and executioner," said activist organisation Demand Progress. "Tell them to back off - or that you'll start looking for other places to bring your business."
Other organisations have raised concerns about the scheme. The Electronic Frontier Foundation (EFF) said such a scheme would undermine the open Wi-Fi movement, " even though open wireless is widely recognized to be tremendously beneficial to the public."
It said an independent body should be in charge of vetting the process.
In the UK, Ofcom's draft code would see users with three strikes within 12 months have anonymous information collected about the which would then be sent to copyright holders. These holders could then seek a court order to find out the identities of the suspected infringer.
The policy had been due to come into force March next year, but was delayed by a House of Lords committee that questioned whether the code, as part of the Digital Economy Act, compiled with Treasury rules.