Combating Counterfeit Components

Appears in Print As: Vantage Point: Combating Counterfeit Components

June 2, 2009

Joseph Ruggiero Vice President North Shore Components Bellport, N.Y.

Given today’s global supply chain, OEMs, contract manufacturers, and repair facilities must be especially vigilant about counterfeit components finding their way into electronic assemblies. Counterfeit components jeopardize product performance and reliability because the materials and specs are knowingly misrepresented. This could result in costly litigation, product recalls, and loss of customer confidence.

Often, fakes are hard to recognize because part numbers have been remarked or disguised. Or they’re defective products that were removed from the reject pile, or old parts salvaged from scrapped PC boards.

The most-effective way to limit exposure to counterfeit electronic parts is to maintain full traceability back to the original manufacturer. Dealing with an authorized franchised distributor helps. However, when the original manufacturer no longer makes the required item, or it’s in short supply, users must source these

products on the open market and the risk of counterfeiting rises dramatically. Purchasing on the open market warrants special precautions, especially with electronic components made in China, as that country is reluctant to enforce laws designed to combat counterfeiting and protect intellectual property. China’s manufacturing sector also offers the ideal infrastructure to produce complex and high-value counterfeit components.

The best way to ensure product reliability and integrity is to purchase electronic components through reputable distributors with stringent quality-control procedures. Products backed by the original manufacturer warranty and that are properly stored and handled offer the greatest assurance of integrity and traceability.

Whenever possible, get certificates of conformance and/or acquisition traceability dating back to the original manufacturer. When such documentation is not available, the next step is to verify compliance through visual inspection, destructive and nondestructive electrical testing, as well as a variety of counterfeit detection tests.

These include 100% incoming inspection, including internal visual verification using decapsulation, curve-tracer testing, RoHS lead-free compliance testing, and X-ray and microscope inspection up to 1,000× using advanced microscopes and CCD cameras. These and other advanced test procedures have proved useful in spotting counterfeit or cloned products. In addition, it is important to verify how the components were handled, stored, and shipped.

As a proactive measure, component buyers should carefully evaluate distributors. Find out if the distributor is ISO 9001:2000, AS9120, and ESD S-2020- 2007 certified, follows IDEA-STD-1010-A inspection techniques for counterfeit detection, and verifies product authenticity by earning CTI CCAP-101 certification for counterfeit avoidance and detection.

Other hallmarks of reputable distributors include memberships in leading trade organizations such as IDEA and ERAI, ethical business practices, use of escrow accounts and product warranties, as well as offering potential buyers enough time to carefully inspect or test component lots prior to final payment.

Also review the distributor’s past business practices, request letters of recommendation, schedule on site visits, and periodically test components to confirm that they meet or exceed OEM specifications. Not all distributors are created equal, so careful scrutiny in the vendor selection process helps mitigate the potential for counterfeit components.

Edited by Kenneth Korane

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© 2012 Penton Media Inc.

Comments

ERAI Response

On February 4th, 2011 ERAI Inc. (not verified) says:

To Whom It May Concern:

For the last several years, ERAI, its principals and employees have been the target of an intense smear campaign orchestrated by an individual who seeks to bring harm to ERAI, its principals, employees and any person or business who interferes with the perpetrator’s ominous cyber attacks. For a long period of time, ERAI was more or less exclusively the primary target of these libelous broadcasts. Now, numerous businesses are among the victims of these often-times unprovoked outbursts.

ERAI is frequently asked why these posts have been and continue to be made. Simply put, due to the nature of our organization which involves monitoring, investigating, reporting, and mediating issues affecting the global supply chain of electronics, it is not uncommon to have companies that have been reported by ERAI attempt to discredit our organization. The hundreds of posts that are currently visible on the Internet have been made by one individual using dozens of Internet screen names. Because the Internet provides bloggers with a cloak of anonymity, a person can create the illusion of numerous disgruntled or concerned individuals when that is simply not the case. The author of these posts is an individual that was reported by ERAI for selling faulty material. He made numerous threats against ERAI and its employees both during the investigation and after he was reported.

It helps to have a better understanding of our organization in order to understand the motivation of these types of criminals. Founded in 1995 and incorporated in 1996, ERAI is a privately held trade organization that has been the industry's primary reporting and investigation service supplying information, mediation and risk mitigation solutions to electronics professionals worldwide. Membership to ERAI is open to franchised and independent distributors, OEMs, OCMs, CMs, test houses, government agencies and associations serving the industry. ERAI is actively involved in a number of committees and task forces that are addressing the issue of counterfeit parts in the global supply chain of electronics.

There are a number of reasons why counterfeiting has become so rampant in the last few years, such as the breakdown of trade barriers among countries with less restrictive IP laws, the green initiatives that have led to more e-waste and easy access through the Internet to market and sell material easily. Counterfeiting has become a global issue affecting multiple industries from electronics to golf clubs, pharmaceuticals and tobacco, among others. It is particularly troubling to ERAI since counterfeit electronics can not only affect individuals’ health and safety, but could even be a threat to national security. Every industry has been affected and ERAI is working diligently to address the problem in the electronics sector and to offer solutions to this very serious issue. Unfortunately, we have to accept the fact that the Internet creates an audience for individuals to post information that is entirely false, inaccurate and without merit.

ERAI is uniting the industry in addressing issues that are plaguing the market and we hope you can be part of the solution with us.

ERAI deeply regrets the frustration and/or confusion these cyber attacks have caused. Despite the difficult obstacles ERAI must sometimes face, it will continue to provide the valuable information and services its Members have come to rely upon to make the most informed business decisions possible. ERAI remains committed to serving its customers with the integrity and professionalism the semiconductor industry has come to expect.

Sincerely,
Kristal Snider
ksnider@erai.com
Vice President
ERAI Inc.