China Is Selling Counterfeit Military Equipment To ... - Business Insider

A fictitious company set up by?U.S. government investigators bought 16 electronic parts for weapons from China online and every single item was counterfeit, according to a Government Accountability Office?investigation as reported by Reuters.?

The?congressional?Government Accountability Office (GAO) published the?report?at the behest of the Department of Defense (DOD) because "counterfeit parts?generally the misrepresentation of parts? identity or pedigree?can seriously disrupt the?DOD supply?chain, harm weapon systems integrity,?and endanger troops? lives."

The problem is that "almost anything is at risk of being counterfeited, from fasteners used on aircraft to electronics used on missile guidance systems. There can be many sources of counterfeit parts as DOD draws from a large network of global suppliers," according to the report.

Last June the investigators on the?Senate Armed Services Committee?identified about 1,800 cases involving one million counterfeit parts since 2009. The GAO conducted the?fictitious shopping trip from?August 2011 to February 2012?as part of the committee's broader investigation, which is nearing completion.

To investigate the practice, GAO created a fictitious company and gained membership to two Internet platforms providing access to vendors selling military-grade electronic parts.?

The company requested quotes from numerous vendors to purchase parts ("new in original packaging,?not?refurbished") from three categories: (1) authentic part numbers for obsolete and rare parts; (2) authentic part numbers with postproduction date codes (date codes after the last date the part was ?manufactured); and (3) bogus, or fictitious, part numbers that are not ?associated with any authentic parts.

It turned out that 334 of 396 vendors who offered to sell parts to the fictitious company were from China.?All 16 parts eventually purchased came from 13 China-based vendors and all were determined by an independent testing laboratory to be counterfeit.

From Reuters:?

It said it bought seven parts with authentic part numbers that were out of production, including parts used on the Air Force's F-15 fighters, the Marine Corps' V-22 Osprey tilt-rotor aircraft and the Navy's nuclear submarines. All of those parts failed inspection and were determined to be counterfeit.

It also purchased five parts with authentic part numbers that were stamped with date codes beyond the item's last actual production date and all of those were determined to be counterfeit as well.

The agency also bought four parts with made-up numbers that are not associated with any authentic parts, which it said showed the willingness of the vendors "to supply parts that do not technically exist."?

The report noted that all 40 of the responses it received for the bogus part numbers also came from China.?

The Government Accountability Office is the audit, evaluation, and investigative arm of Congress that examines the use of public funds; evaluates federal programs and policies; and provides analyses, recommendations, and other assistance to help Congress make informed oversight, policy, and funding decisions.

The GAO cautioned that the results of the latest report were based on a small sample and could not be used to make inferences about the extent to which parts were being counterfeited.?

Source: http://www.businessinsider.com/china-is-selling-counterfeit-military-equipment-to-the-department-of-defense-2012-3

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