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Senate hearings shocker: one million fake electronics in U.S. military systems. DNA marking is the clear solution.

November 13, 2011

Applied DNA Sciences has been working since June on an 18 month, million dollar pilot with an agency of the Defense Department on a system that we strongly believe has proved, so far, that it can stem the malicious flood of fakes. (see press release, June 22, 2011).  The testing of our DNA marking and authentication technology, together with the Defense Logistics Agency (DLA), and a major chip manufacturer, has had laser-like accuracy in ferreting out the fake from the real.  Results so far have shown a success rate of 100%.

But even we have to admit that the scope of the crisis, as revealed by the Senate Armed Services Committee hearings last week, is breathtaking.

As Senator McCain counted it off:

“The committee uncovered over 1,800 incidents, totaling over 1 million parts, of counterfeit electronic parts in the defense supply chain. That is an astounding number. And it begs the question: if one million counterfeit parts were caught in the supply chain, how many were not?”  (ABS News)

Well put, Senator. 

And you could extrapolate a little bit.  Some of those “incidents” are no doubt the 35 seizures of counterfeit microchips made by Customs and Border Police from the pipsqueak Florida microchip distributor VisionTech.   Note, as we have previously posted, that those thirty-five seizures were a tiny portion of the more than three thousand that VisionTech shipped, all the while under surveillance.  That’s a catch of 1% of the total if you’re counting.   Considering that this company was practically in the business of dealing in fake chips, how authentic was the other 99%?

Our company and many of our friends and partners are now working to awaken the public to the solution: DNA marking and authentication.  That solution is tested. Furthermore, exploration of DNA tagging as an approach to the crisis and has been publicly declared a priority by the agency tasked with supplying the entire U.S. military: the Defense Logistics Agency (DLA).  (In its Director's Guidance report, publicly issued in October).

We will report on these efforts in posts to follow.

Meanwhile, we can’t help enumerating some of the most striking testimony at the Senate hearings:

  • Counterfeit electronic parts, installed on military equipment manufactured by Boeing, L-3, and Raytheon, are currently in use on aircraft flying missions in Afghan combat zones.
    Business Insider
  • Non-approved” Chinese parts have been found in Boeing aircraft including the C-17 cargo plane, the F/A-18F Superhornet fighters, and CH-46 Chinook.
    Salon magazine
     
  • Other counterfeit parts -- usually from China – have been found on at least seven aircraft, including the Lockheed Martin Corp. C-130J transport plane, Boeing P-8A Poseidon maritime patrol and L-3 27J Spartan transport. 
    Bloomberg News
     
  • Michigan Senator Carl Levin, the Committee chairman, said that, as yet, there are no known instances of fatal or dramatic failures in combat, such as an airplane crash.  But there are, Levin quickly added “…lots of places where, unless that correction was made, there was real fear that those kind of disastrous consequences could take place.”
    Washington Post
     
  • The committee’s investigation uncovered suspected counterfeit parts on thermal weapons sights delivered to the Army, on mission computers for the Missile Defense Agency’s THAAD (Terminal High Altitude Area Defense) missile, and on military airplanes including the C-17, C-130J, C-27J, and P-8A as well as on AH-64, SH-60B, and CH-46 helicopters.
    ABC News
     
  • China has been identified nearly five times more frequently than any other country as a source of counterfeit parts, according to a US Commerce Department report, according to Reuters.
    Reuters
     
  • Chinese Foreign Ministry spokesman Hong Lei responded  to the Committee testimony in a Beijing press conference on November 9, saying China was committed to fighting fakes:

    "The Chinese government has always paid a great deal of attention to, and has promoted, cooperation with relevant overseas bodies in the fight against counterfeits. This is universally acknowledged," Hong told reporters.
    Reuters
     

  • Thomas Sharpe, Vice-President of SMT Corporation, a distributor which specializes in rigorous testing of microchips against counterfeiting, describes a trip he made to the infamous Shenzhen microchip marketplace in Guangdong Province, People’s Republic of China.  Part of his report, as cited in testimony to the Committee:

    “While touring the Shenzhen marketplace with a local interpreter I was told:

    1) The electronic marketplace district was the largest wholesale component distribution area of its type in the world.

    2) 30-40% of all Broker-sold products at this marketplace are counterfeit.

    3) Many of the booths we passed contained companies that own counterfeiting operations elsewhere within China.

    4) Local brokers and manufacturers purposely buy counterfeits for a 70% savings off authentic component prices – fully aware that up to 15% may not function at all.

    5) Products sold to brokers outside of China are represented to be new, original factory product at time of sale.

    SMT SASC Full Statement for the Record, 11-08-2011
     

  • Sharpe also said: “It’s growing much worse. The counterfeiters are changing their processes to get in front of the processes that they know that we are currently doing to detect their processes. So the process is evolving, and it’s getting harder to detect.”
    ABC News
     
  • The Committee indicated that tighter rules or legislation was coming:

    "The panel is considering ways to tighten rules against the counterfeits, according to Bloomberg News, including requiring the defense contractors to pay for replacing the parts with genuine items."
    Bloomberg News

 

US weapons 'full of fake Chinese parts'

A Lockheed Martin C-130J "Super Hercules"

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