Senators to Take on Counterfeit Electronic Parts in DOD
Tuesday the Senate Armed Services Committee will hold a hearing on counterfeit electronic parts in the Defense Department’s supply chain, which, they say, affects the military’s ability to defend the nation.
“What we’ve learned so far will shock you and will shock the American people,” Sen. Carl Levin, D-Mich., chairman of the Senate Armed Services Committee, said today in a preview of the hearing, “There’s a flood of counterfeit parts entering the defense supply chain. It is endangering our troops and it is costing us a fortune.”
The committee hearing will take aim at China, which has been singled out as a source of the counterfeit goods, providing U.S. troops with “unreliable” weapons by using “fake parts” that have been “salvaged from trash heaps by Chinese counterfeiters.
“In more than 70 percent of the cases, the trail led to China, where a brazenly open market in counterfeit electronic parts thrives,” Levin said. “Rather than act to address the problem, Chinese authorities have impeded our investigation.”
Witnesses at Tuesday’s hearing who have seen first-hand how counterfeiters in China remove electronic parts from scrapped computers, wash the parts in dirty rivers and dry them on the streets so that they can be resold, will tesify about what they’ve seen.
“We’ll hear how the counterfeiters make the scrap look like new parts. And then we’ll hear how these parts are sold openly as new parts in markets in Chinese cities like Shenzhen, the epicenter of the counterfeit trade, and they’re also sold through the Internet to buyers around the world,” Levin said.
Sen. John McCain, R-Ariz., the ranking member on the committee, said the finding that China had been the culprit in well over half of the counterfeit products is “worrisome but not surprising.
“China has long dominated as a source for counterfeit goods into the United States of America,” McCain said today. “We need to realize that this issue is part of a broader challenge we face in our relations with the People’s Republic of China, the fact that it’s falling short in certain important areas of its obligations as a responsible stakeholder in the international system.”
The senators today said they couldn’t solve the counterfeiting problem in China, at least not in the short-term, so the focus should be on improving the way the Department of Defense purchased electronic parts.
“Our military and defense industry must act immediately,” Levin said today. “We must modify acquisition rules so that the cost of removing suspect counterfeit parts from defense systems is paid for by the contractor, not by the taxpayer — no ifs, no ands, no buts. And regardless of the type of contract, we should require in all cases that when contractors discover a case of suspected counterfeit parts in a military system that they report that discovery to the military right away, and we should enforce that requirement.”