I've no idea on legality, but it would break the computer usage policy of just about any company that has such a policy - and certainly where I work it would count as gross misconduct and you would likely be immediately dismissed with no right to appeal.

Or in this case, expelled.
And yes they really do that, trust me.. I know.

Wow. Just… wow. Where I work (I program microcontrollers) there's just one policy: your code must be written in time and run properly and stable. Oh, and no warez allowed.
Well, may be I'm just lucky as devil.

Yup - to quote from my company handbook:

"Individuals will be given access to computer systems in-line with the requirements of
their job role, as defined by their Line Manager. User profile passwords are not to be
shared with other individuals. Unauthorised use of anyone else’s password to gain
access to systems to which you are not authorised will be regarded as gross
misconduct and will be subject to disciplinary action. It should be noted that any
activities performed against a user access profile are considered performed by the
individual to whom that profile was initially allocated.

Any personal use of the Company’s computer, so long as it is not in violation of the
above, must be kept to a minimum and should take place before or after the employee’s
working hours or during lunch breaks.

Any employee who uses the Company’s computers in violation of these guidelines shall
be subject to disciplinary action, which could result in action up to and including
dismissal, with or without notice. "

The thing is if he owns it why CAN'T he install stuff?? It honestly sounds more like hardware provided for him than him owning it :S

Well, that's the whole point of the thread, now isn't it?