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Senate Armed Services Committee  (Source:
The Senate Armed Services Committee said mixing fake electronic parts with authentic ones could potentially build faulty systems that could place the lives of soldiers in danger

A Senate Armed Services Committee hearing yesterday has pointed out that counterfeit weapons have become a serious issue as of late -- and China is mostly to blame.

The U.S. is already in a cyber war with China, where China uses freelance hackers as well as official hackers to attack government servers and international businesses to obtain useful information. China was suspected to be involved in several cyber attacks in the past year alone, such as the Lockheed Martin hack in May and the Gmail accounts hack in June. In August, the U.S. got its first glimpse at a hack being conducted by the Chinese government in a leaked video, which also bragged about China's hacks on the U.S.

Now, the issue of selling fake electronics to the U.S. military is just another problem to add to the pile between the U.S. and China. At the Senate Armed Services Committee hearing, it was said that mixing fake electronic parts with authentic ones could potentially build faulty systems that could place the lives of soldiers in danger.

"The failure of a single electronic part can leave a soldier, sailor, airman, or Marine vulnerable at the worst possible time," said Sen. Carl Levin (D-Mich.), chairman of the committee. "A flood of counterfeit electronic parts has made it a lot harder to have confidence that won't happen."

According to the semiconductor industry, counterfeiting results in a $7.5 billion loss in revenue annually as well as a loss of 11,000 U.S. jobs. The Pentagon mentioned that no lives have been lost and no missions have failed due to counterfeit electronics yet, but the potential is there.

The committee said there have been 1,800 cases where counterfeit electronics were sold to the Pentagon, and the total number of parts involved in these cases was over 1 million. Company executives, a government investigator, a Defense Department official, and a representative of the semiconductor industry were present to testify at the hearing about the potential harm of counterfeit electronics being placed in "multimillion-dollar" aircraft and missile systems.

According to the Senate Armed Services Committee, China is mostly to blame, and even mentioned that a representative from China was missing from the hearing despite the panel writing to the ambassador to send someone to testify.

The Government Accountability Office even created a fake company in order to buy electronic components from China over the internet, and managed to purchase 13 parts. When investigating seven of these parts, none were found to be genuine.

The U.S. has decided not to sit on this matter. In fact, the Defense Department said it is training 2,000 personnel to learn to identify fake electronics in a quality assurance process.

China's Foreign Ministry has responded to the accusations, saying that it too places importance in "fighting fake and shoddy goods with competent authorities of other countries" and that it has "actively promoted cooperation" in doing so, and "such efforts are well known to all."

"We do not want to be in a position where the reliability of a $12 million THAAD interceptor is destroyed by a $2 part," said Army Lt. Gen. Patrick J. O'Reilly, director of the Missile Defense Agency.

Source: Associated Press

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RE: Foundry Services
By homebredcorgi on 11/9/2011 12:41:01 PM , Rating: 4
Believe it or not, they are obtaining old (often used or obsolete 1980's and 1990's vintage) chips, sanding them down and re-labeling them as brand new. We aren't talking Intel or AMD CPUs, but much lower level ICs.. The military tends to use very old designs as they are proven reliable, tend to be less susceptible to EMI and remain compatible with even older designs.

Part of the problem is our supplier model. Prime contractors hire other companies who in turn hire other companies to design/build small components. It's part of our wonderful world of globalization and cost cutting - that and China's penchant for stealing anything that isn't nailed down and then copying the design for half of the things that are nailed down. Why we continue to allow their blatant theft of IP, I'll never understand.

In summary, having complete control over the supply chain is apparently too expensive - even for military hardware.

"This is about the Internet.  Everything on the Internet is encrypted. This is not a BlackBerry-only issue. If they can't deal with the Internet, they should shut it off." -- RIM co-CEO Michael Lazaridis

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