Monthly Archives: March 2012

Levin, McCain: GAO report shows China is failing to crack down on bogus electronic parts

Levin, McCain: GAO report shows China is failing to crack down on bogus electronic parts

Monday, March 26, 2012

WASHINGTON – A government investigative report released today provides further evidence that China is failing to crack down on the flood of bogus electronic parts making their way into U.S. military systems and endangering the safety of U.S. troops and U.S. national security.

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GAO Report – DOD Supply Chain: Suspect Counterfeit Electronic Parts Can Be Found on Internet Purchasing Platforms

Suspect counterfeit and bogus—part numbers that are not associated with any authentic parts—military-grade electronic parts can be found on Internet purchasing platforms, as none of the 16 parts vendors provided to GAO were legitimate. “Suspect counterfeit,” which applies to the first two categories of parts that were tested, is the strongest term used by an independent testing lab, signifying a potential violation of intellectual property rights, copyrights, or trademark laws, or misrepresentation to defraud or deceive.

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Chabot and Poe Introduce Bill to Enforce IP Rights

Reps. Steve Chabot (R-Westwood) and Ted Poe (R-TX) introduced H.R. 4216, the Foreign Counterfeit Protection Act. The legislation allows Customs and Border Protection (CBP) to exchange important information with rights’ holders in order to protect intellectual property (IP) rights and to uphold the integrity of trade.

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Overarching DoD Counterfeit Prevention Guidance

16 March memo from Hon. Frank Kendall, Acting Undersecretary of Defense for AT&L, concerning “Overarching DoD Counterfeit Prevention Guidance” directing DoD Components to immediately take specific actions to “decrease the probability of counterfeit items across the Department.

Counterfeit Microelectronic Parts and Inspections & Tests That Reveal Them

New government requirements call for a careful look at inspections and tests necessary to detect and intercept counterfeit parts. When considering purchases from suppliers other than the original manufacturer or its authorized suppliers, risk assessments must account for the fact that the probability of a counterfeit electronic part quality escape will depend heavily on supplier qualification requirements and the extent of inspections and tests applied to detect counterfeits. The design of test and inspection flows should include a reliability physics methodology necessary to reveal the more insidious varieties of counterfeit and fraudulent parts circulating throughout the open market.

NOTE: For the purpose of this specific essay, I use the expression ‘counterfeit and fraudulent parts’ due to new proposals to designate ‘used parts presented as new’ as ‘fraudulent parts’ and rather than including them within the definition of ‘counterfeit parts’.

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NDAA Sec 818(g) and Expectations to Stop Counterfeits at the Border

New industry standards have been created to provide uniform requirements, best practices and methods to mitigate the risks of receiving and installing counterfeit electronic parts. Use of industry standards, however, will not reduce the significant and increasing volume of counterfeit electronic parts entering the DOD supply chain. Subject matter experts agree that the Intellectual Property (IP) rights holder is best qualified to determine if a product is authentic or not. US Customs and Border Protection (CBP) must have the authority to consult IP and trademark rights holders (e.g., Original Component Manufacturers) for assistance in determining whether or not imported goods are authentic.

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Unfortunate use of the term ‘Trusted Supplier’

The use of the term trusted supplier within Section 818 of the FY2012 NDAA is an unfortunate choice of words on the part of Congress. It’s use here differs significantly from its current use with respect to the “DoD Trusted Foundry Program”, an accreditation plan for design, fabrication, packaging and test services across a broad technology range for specialized governmental applications.

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