Counterfeit Chinese Technology: Gateway for Hackers?

Some parts ended up in networks serving the Marine Corps, Air Force, Federal Aviation Administration and the FBI.

The cheap, lower-quality equipment led to some system failures and other problems. The real concern, though, is whether this computer hardware represents some sort of Trojan horse that can be manipulated by hackers to steal sensitive information.

Cisco spokesman John Noh told ABC News via e-mail that the company has extensively tested counterfeit equipment purporting to be made by the company, and though not "technically inconceivable," the company's tests "have not found a single instance of software or hardware that was modified to make them more vulnerable to security threats."

Noh acknowledged that counterfeiting of computer technology is "an industrywide issue," but that Cisco has an internal team dedicated to preventing damage from counterfeiting and that the company works with law enforcement in its investigations.

According to the FBI PowerPoint, Cisco controls 80 percent of the computer router technology market.

The FBI and a number of government agencies are now examining the hardware trying to determine if there has been a massive security breach.

The People's Republic of China has not been accused of orchestrating the counterfeit sales, but for several years, U.S. officials have been investigating a wave of government computer breaches thought to have originated in China.

Cisco has been working with U.S. investigators and representatives from China's Technical Service and Public Security bureaus since 2003 to combat the counterfeiting of its routers.