The U.S. Senate Armed Services Committee has found that counterfeit electronic parts are finding their way into the U.S. military supply chain at an alarming rate.
The Senate released a report that claims that on 1,800 separate occasions, the U.S. military or contractors have purchased electronics materials for defense systems that were either fake or poorly recycled.
In some cases, defective chips made their way into critical U.S. weapons and navigation systems. The examples could provide a serious wake-up call to defense contractors and others involved in the military supply chain. In one instance highlighted by the Senate report, it was pointed out that, on September 8th, the defense contractor Raytheon notified the Navy of the following:
"Counterfeit transistors had been found on a night vision or FLIR system used on the Navy’s SH-60B helicopters. If the FLIR system were to fail, the Navy said the helicopter would be unable to conduct surface warfare missions using Hellfire missiles."
In another example involving the Air Force’s C-27J aircraft, the report stated that, on September 19, contractor L-3 told the Air Force that "38 video memory chips installed on the plane’s display units were suspected to be counterfeit."
The Committee released the results of the months-long investigation earlier this week and met again today discuss legislation aimed at tackling the problem. Led by Sen. Carl Levin, D-Mich., and Sen. John McCain, R-Ariz., the committee staff traced the DoD supply chain back to its start for more than 100 counterfeit parts and found that 70 percent of them originated in China.
Another 20% came from countries like Canada and the U.K. that resold Chinese parts to the U.S. Realistically, closer to 90% of faulty electronics in military equipment came from China.
And the problem appears to be getting worse for the defense industry. The Senate report cited Commerce Department statistics including one that said, "In 2005, there were 3,868 incidents detected, compared with 9,356 in 2008."
To deal with this growing problem, the Senate Committee wants stricter enforcement of the laws that protect the national defense supply chain, and even to hold Chinese parts longer at customs terminals for special inspection.
In addition, Senators on the Committee want contractors to be responsible for the replacement cost of faulty parts instead of the taxpayer. The bill for replacement parts can cost millions of dollars.
The report also discussed the complex lifecycle of Chinese counterfeit electronic parts. Electronic waste is shipped from the United States and the rest of the world to Hong Kong, where the raw materials then are often transferred to mainland China. At that point, as the Senate report says, the electronics are broken down and refurbished with no quality controls, including:
“burned off of old circuit boards, washed in the river, and dried on city sidewalks... part of this process includes removing any indentifying marks, including date codes and part numbers. Once the old part is made to look new, it is shipped to the Chinese city of Shenzhen. From China, the counterfeit part makes its way through the DoD supply chain, often passing through four or five subcontractors before a prime contractor has integrated it onto a weapon system."
While the report focuses on unintentional threats to the military supply chain, the presence of shoddy Chinese electronics in thousands of devices and the apparent U.S. reliance on China for its national defense supply chain should concern all Americans.
It's one thing to outsource toys and toasters, but more than anything else, American military equipment should probably bear the stamp "Made in U.S.A."
(H/T: Army Times)