On June 16, 2011, S. 1228: Combating Military Counterfeits Act of 2011 was introduced in the US Senate. The bill, which has bipartisan sponsorship and support, has been reported out of the Senate Judiciary Committee and is recommended for consideration by the Senate as a whole.
Undoubtedly, you're quite familiar with this pending legislation by now. In a nutshell, the legislation updates the 2010 version of the Act, which criminalizes trafficking in counterfeit military goods and services. The 2011 Act imposes increased penalties for violation: a fine of up to $5 million, imprisonment for up to 20 years, or both, for a first offense by an individual; a fine of up to $15 million for a first offense by "a person other than an individual"; and significantly increased penalties for subsequent offenses.
I've thought about this language time and again: Can a problem like counterfeiting simply be penalized away? So, I turn to analogies to help me understand what's going on. Here's one I've tried to apply. See if it works for you. When it comes to legislation or civil law, one sees many similarities in structure.
For example, in Georgia, laws related to driving while under the influence of alcohol impose higher fines and penalties for each violation, including imprisonment, just like S.1228. The good news is that according to the Georgia Department of Transportation, alcohol-impaired driving fatalities decreased in 2009 by about 20 percent, which appears to have been a nationwide trend over the last decade.
Which leads to the obvious question of what is causing the decline. The answers turn out to be numerous and complex, but one thing became clear to me during my cursory research: Fines alone were not responsible. There have been countless program implementations that went beyond fines -- and what the programs did, in essence, was to influence driving-related "processes." Let that sink in for a moment. Do you agree or disagree?
The proposed S.12228 legislation certainly is a step in the right direction and raises awareness of the potential risks counterfeit parts present, and I applaud the efforts of Senator Sheldon, who introduced the legislation, and the nine senators who were co-sponsors of the bill. But I don't think it's likely that higher fines and longer prison terms will be enough to get counterfeit components out of the supply chain. Why not? I have at least two reasons and will discuss these in my next blog.
Problem that money can solve is not a problem to the few that are rich. But when there is a jail term without bail option is imposed, it will definetly cut down the crime
The magnitude of the counterfeiting issue is severe, the parties involve within the supply chain are to find ways of protecting themselves individually.
I agree - most people who engage in this type of illegal activity think that they won't get caught (otherwise, why do it?). This thinking tends to lessen the risk versus reward analysis from real consideration, at least at the beginnig. And once involved, I'm sure it's hard to stop - if you've already taken the risk, one wants to further the reward.
We are suppose to be discussing countfiet parts NOT DRUNK DRIVERS!
Most Military parts have approved manufactures listed! The Distributors should be buy from an approved manufacturer!
The big question is how do you control CONTRACT Manufactures that assemble military parts, PCB's and units in Asia by China owned contract manufacturers???
I think the two examples are different and mutually exclusive. Driving under the influence affects regular citizens who make bad decisions and sometimes have to be "hit over the head" so to speak in order to avoid fines, penalties and possibly Jail. Dealing in counterfeit military products, is an entirely different element. People that are doing this aren't just making bad decisions but they are consciously and coherently making illegal transactions. The higher fines won't affect the problem since I assume the trade results in hefty rewards. Perhaps the higher penalty of Jail would deter some, but most likely not all.
Motivations for behavior are sometimes more complex than we would think. I've also seen the studies that it took increased fines to get drivers to comply with the laws-- even for seat belts and not holding cell phones while driving. Usually the harsher penalties were put in place after advertising campaigns alone proved to have little impact. But more severe punishments do not always deter crime, and murders still take place in states that do have the death penalty.
@Daniel, I totally agree with you that fines alone will not reduce the crime. But higher penalty will definitely force people to think before they violate any laws. But the most important point is how effectively those laws are implemented.
Although I agree with the core of your thought that harder punishment and bigger fines do not solve the problem, I dont think it is the same the example with alcohol and the problem with the counterfeits. Before starting to say that 20 years is a lot of years in prison or not for an offense like counterfeiting, we must see the profile of the people that doing the offense.
@FlyingScot: Yes, I concur with you. It should rather be two prong approach. what is the market size for this market and how much resources government will provide?
Strong relationships between suppliers and customers is essential. In the event counterfeit parts turn up, channels of communications are open and issues are easier to resolve.
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Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Peter Drucker famously said "Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window." Yet in the razor's-edge world of electronics—with a lean supply chain and just-in-time demands—the need to know the future is vital.
While no one really can accurately predict the future, we can take guidance from another Drucker saying which is the best way to predict the future is to create it.
You've heard the saying "the No. 1 supply chain risk is your people." That hasn't always been the case. But today's complex global supply chain requires a new type of multitalented employee. It's one who understands, finance, marketing, economics, is savvy with technology, graceful with relationships and can think analytically.
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