The scourge of high tech

John Keller, Editor in Chief

One of the worst trends to emerge in military systems design involves counterfeit electronic parts-those that appear genuine, but which actually are substandard, altogether different, or in the worst cases, simply empty packages.

Counterfeit integrated circuits (ICs), capacitors, amplifiers, batteries, connectors, power-management devices, and other electronic parts already are making their way into mission-critical military and aerospace systems-some of which depend on the utmost reliability.

The sources of counterfeit parts are in the United States and around the world. China is an emerging source of counterfeit parts. Some parts simply begin life as manufacturing overruns. Some come from well-meaning manufacturers who believe they have equivalent parts. Others come from unscrupulous shops seeking to exploit a hot market and a trusting set of buyers.

The reason for this creeping scourge, of course, is money. Since the 1990s the military has moved away from mil-spec components and now relies almost exclusively on commercial manufacturers for electronic parts.

The benefits of this approach are obvious-competition between several suppliers that results in the lowest possible cost to the buyer. The taxpayers save money, and military and aerospace systems get the parts they require. What could be wrong with that?

In a perfect world the answer would be nothing. In the real world, however, plenty of people want to skim off a few bucks, and counterfeit electronic parts have helped them do it. It’s all a matter of high demand.

Systems integrators who need hard-to-find parts cannot always obtain them from the parts manufacturers or from reliable distributors. Sometimes the only sources of parts are small brokers who cannot provide the documentation to prove the pedigree of their offerings. Parts obtained in this way often come from the so-called “gray market” where counterfeit parts abound. If there’s a demand for a part, someone will meet it, no matter where the part comes from.

Today’s environment is favorable to parts counterfeiters. Really all a potential counterfeiter has to do is find out which parts are in the highest demand, get his hands on one of these popular parts, and copy the packaging, pinouts, and manufacturer’s markings. Unless a buyer either really knows what he’s looking for, or takes great pains to screen and rescreen parts, these counterfeits can find their way into all kinds of military and aerospace systems.

The problem of counterfeit parts noticeably started cropping up three to five years ago. Since then there have been cases of leaky and sometimes-exploding capacitors in PCs, as well as other instances of fake parts that cause problems.

One U.S. aftermarket IC supplier recently put in a bid to supply parts that are no longer made by the original manufacturer. In fact, this IC supplier right now is the sole manufacturer of the part, which it produces legally under license.

Unfortunately the aftermarket supplier did not submit the lowest bid-a parts broker did, and won the job.

Interestingly, officials from the aftermarket supplier checked their books and found that they had not actually sold any of these parts; every one of the parts the company had ever manufactured was still on the company’s shelves.

What’s the probability that the parts the winning bidder provided to its customer were counterfeit? The answer is probably close to 100 percent. It’s scary to think that this is only one isolated case out of thousands.

What’s the probability that at least some counterfeit electronic parts are getting into missiles and other munitions, into commercial and military aircraft avionics, into communications and reconnaissance satellites, and into crucial networks that will enable the battlefields of tomorrow? I shudder to speculate.

In fact, military agencies, defense contractors, and battlefield commanders do not know how many counterfeit parts have been designed into mission-critical systems. We may not ever know. The results of designed-in counterfeits, however, are likely to involve system failures that come at the worst possible moment.

There’s plenty that systems integrators can to help shield themselves from inadvertently designing in counterfeit parts.

First, engineers should buy components only from manufacturers and authorized distributors who can provide the documentation necessary to trace the origins of the parts they buy. When this is not possible, buyers should demand the paperwork to identify the manufacturing source. The supplier’s failure to do so is a not-so-subtle hint that the parts involved are questionable.

Systems integrators need to know their independent distributors, and buy only from the brokers they know and have done business with successfully for a long time.

Systems designers also should consider holding up payment for electronic parts until the parts have been received and verified. Buyers should ask for samples to test. Even after taking these steps, systems integrators should screen and rescreen the parts they buy from brokers. Only by doing these things can engineers hope to protect themselves from this growing threat.

Even though individual companies can take steps to protect themselves from counterfeit parts, more needs to be done. Parts manufacturers, distributors, brokers, and systems integrators must continue to coordinate their efforts and come up with fail-safe ways to identify counterfeits. Then the government needs to go after the counterfeiters, no matter where they are.

Government agencies must do better in combating this problem. The U.S. Defense Supply Center Columbus (DSCC) in Columbus, Ohio, has come to be a trusted partner for systems integrators. Not only does DSCC help coordinate industry standards for quality, but the center also provides hard-to-find electronics parts from its warehouses.

Organizations like DSCC should lead efforts to combat counterfeit electronic parts. DSCC’s Counterfeit Material/Unauthorized Product Substitution team pursues suppliers of counterfeit material and unauthorized product substitutions. DSCC’s program addresses a wide range of nonconforming products delivered by contractors to the government. The team investigates, monitors, and takes corrective action against contractors who deliver counterfeit items, submit falsified documents, or deliver substitute items.

This is a great start, but it applies to companies that defraud the government, leaving prime contractors and systems integrators holding the bag. It’s up to everyone involved in the military electronics industry to step up and find a way to eradicate the scourge of counterfeit electronic parts.

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Mil & Aero Magazine

August 2015
Volume 26, Issue 8

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