Counterfeit electronic parts are on the rise. The US military is particularly alarmed.
The Senate Armed Services Committee met in November to discuss the risk counterfeit parts are posing to the reliability of US military defense systems. After the hearing, Senators Carl Levin and John McCain introduced an amendment to the National Defense Authorization Act to address this problem. The Senate passed it 97-3. It is expected to pass the House as well and become law shortly.
Why all the concern?
Counterfeit electronic parts are invading the US supply chain at an increasing rate. More than 70 percent of the counterfeit parts are coming from China. Ironically, counterfeiters in China are frequently making counterfeit parts from US electronic waste (e-waste) shipped to China. (See: Military Hardware Security Compromised .)
Counterfeiters typically take scrap components (like semiconductors and transistors) and then sand off part numbers and any other identifying marks. Then in a process known as “black topping,” they recoat the parts to hide the sanding marks. Black-topped parts often look brand new.
The US defense industry is particularly vulnerable to counterfeit electronic parts. It typically relies on military and commercial-grade “obsolete parts” to maintain its equipment. That reliance results from the long lifecycles of defense systems. An electronic part may be manufactured for only a couple years, while a defense system can remain in service for over two decades.
Defense contractors are often forced to purchase hard-to-find replacement parts from independent distributors. There is an inherent risk in doing this. While some independent distributors operate legitimately, others may be set up for the sole purpose of selling counterfeit parts. Some defense contractors understand that and take steps to reduce counterfeit risk. They impose strict requirements on their suppliers and test electronic parts not purchased from an original manufacturer or authorized distributor.
The ease of doing business via the Internet adds to the problem. It provides counterfeiters access to the global marketplace. A large number of internet-based distributors specialize in selling counterfeit parts.
How can you avoid counterfeit parts?
Here are several ways to help ensure you are not buying counterfeit parts:
- Buy only from an original manufacturer or an authorized distributor.
- Avoid making gray-market purchases.
- Send your scrap electronic equipment to a high-quality in-country recycler that does not engage in offshore e-waste shipments.
- Authorized distributors should establish systems to reduce counterfeit risk, adopting and adhering to strict, internationally recognized quality standards, like AS9100, AS9120 or AS6081. (See 10 Tips for Avoiding Counterfeit Components.)
What does the new rule adopted by the US Senate require?
The Levin-McCain amendment targets large US defense contractors. It requires them to establish systems for detecting and avoiding counterfeit parts and authorizes reduced payments to contractors who fail to do so. It also requires contractors to absorb the costs of fixing problems caused by counterfeit parts.
In addition, the amendment requires the Secretary of Homeland Security to conduct enhanced inspections of electronic parts, and the Department of Defense to adopt policies and procedures for detecting/avoiding counterfeit parts and for assessing and acting on reports of counterfeits.
Are you alarmed by the increase in counterfeit parts? Are you taking any actions to avoid counterfeit parts? Let me know.
And test your counterfeit parts knowledge with this quiz.