Counterfeit Electronic Parts

Introduction

There has been a proliferation of counterfeit products being imported into the United States and other countries within the last 10 years.

Recent reports, Inquires, etc., are listed in the next section. Recent legislative requirements, and guidance follows starting with the National Defense Authorization Act of 2012.

Recent Reports, Inquiries, and General Information regarding Counterfeit Electronic Parts

Government Accountability Office - Suspect Counterfeit Electronics Parts Report

This is an investigation GAO performed related to counterfeit parts. GAO established a fictious company, and bought parts from vendors and suppliers, and then had an independent lab determine if those parts were original or counterfeit.

See the report http://www.gao.gov/assets/590/588736.pdf

Inquiry into Counterfeit Electronic Parts in the DoD Supply Chain - Report of the Committee on Armed Services; US Senate

This is a very comprehensive report, citing examples, reasons why this is problematic, and recent actions taken to combat the problem. US Government Contractors should review this report if you are manufacturing products, and buying parts other than Original Equipment Manufactured (OEM). http://www.armed-services.senate.gov/Publications/Counterfeit%20Electronic%20Parts.pdf

Trilateral Safety and Mission Assurance Conference - April 2008-

This is a slide deck presented at the Trilateral Safefy and Mission Assurance Conference. It provide information regarding counterfeit parts, including common identification and common traits of counterfeit parts.

http://www.hq.nasa.gov/office/codeq/trismac/apr08/day2/hughitt_NASA_HQ.pdf

Recent Legislation and Guidance

2012 National Defense Authorization Act (NDAA) -(December 2011)

Section 818 of the National Defense Authorization Act of 2012, enacted December 2012 contains new requirements for the Department of Defense (DoD) to detect and avoid counterfeit electronic parts. DoD is working to meet Section 818's mandates of assessing current departmental policies and developing specific actions to be taken. While Dod establishes Policies regarding Counterfeit Electronic Parts, the Under Secretary of Defense is an Overarching DoD Counterfeit Prevention Guidance memorandum.

DoD Counterfeit Prevention Guidance Memorandum from Under Secretary of Defense (March 2012)

Definition

Counterfeit materiel is defined as "an item that is an unauthorized copy or substitute that has been identified, marked, and/or altered by a source other than the item's legally authorized source and has been misrepresented to be an authorized item of the legally authorized source." Additionally, a used item represented as a new item may also be subject to fraudulent representation procedures. Reference DoD Counterfeit Prevention Guidance Memorandum.

Purpose - [Prevention Guidance Memorandum]

That memorandum states that DoD Components should (note; the term shall is not used) take action to decrease the probability of counterfeit items across the department. The memo list 10 items, they are:

• 1.Ensure program managers are notified by their suppliers,contractors and subcontractors, when critical items are not obtained from the original equipment manufacturer, original component manufacturer, or an authorized distributor, particularly where electronic parts are

• 2. Require program managers to follow the Program Protection Plan Outline and Guidance which includes the requirement to evaluate counterfeit risk and implement countermeasures for mission critical components.

• 3. For other than mission-critical components, where the program or item manager has determined there is counterfeit risk that warrants action, the program manager or item manager must document risk mitigation.

• 4. Reaffirm the requirement to include DFAR 252.246-7003 - Notification of Potential Safety Issues in solicitations and contracts for the acquisition of:
  • (1) repairable or consumable parts identified as critical safety items;
  • (2) systems and subsystems, assemblies, and subassemblies integral to a system; or
  • (3) repair, maintenance, logistics support, or overhaul services for systems and subsystems, assemblies, subassemblies, and parts integral to a system.

• 5. Participate in a Department-level review to identify appropriate industry standards for anti-counterfeiting and address those standards in contracting requirements as appropriate.

• 6. Establish testing and verification requirements for items not received from an original equipment manufacturer, original component manufacturer, or authorized distributor that are identified as having high risk for counterfeit potential.

• 7. Ensure contractors and subcontractors reports of suspected or confirmed counterfeit items are entered into the Government-Industry Data Exchange Program (GIDEP) system, which will serve as the DoD central reporting repository.

• 8. Report suspected or confirmed counterfeit items discovered by DoD activities in GIDEP using the Product Quality Deficiency Reporting process as appropriate.

• 9. Investigate suspected counterfeit incidents discovered or reported, and report incidents confirmed as counterfeit to the appropriate criminal authorities. In the case of suspect counterfeits, the parts should be held until resolution ofthe potential non

conformance is complete.

• 10. Develop and provide training to DoD personnel.