X-Rayted Files: The Risk of Installing Counterfeit Parts

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In high-tech manufacturing, the use of sub-standard components can be catastrophic. There is no greater need for quality control than in PCBs, as they are only as good as the components installed on them; therein lies the problem. Some components shipped to manufacturers are counterfeit!

But first, let me define counterfeit. One dictionary defines counterfeit as “made in the imitation of something else with the intent to deceive.” Companies that copy a designer handbag down to the smallest detail and sell it as genuine are guilty of this definition. It is seen in everything from art to wristwatches. However, there is a gray area when it comes to circuit board components. Any part sold without disclosure to its age and origin are, by the above definition, counterfeit. Some may dispute this claim, stating that the component is old but not fake. However, any sale without complete disclosure falls into this category by sheer misrepresentation.

Granted, any part installed in the past will eventually become obsolete. To replace these parts, manufacturers have no choice but to source them wherever they can find them. Aeronautics and military applications are especially in need, as many fighter jets and passenger planes are in service for many years. In cases like this, the industry has no choice but to search for replacement parts through alternative sources. In these specific cases, buyers make all attempts to locate parts through reputable sellers of used or refurbished components. That adds to the ongoing confusion of what is, and is not, counterfeit. Because most of these parts originate outside of the United States, it is a gamble whenever buyers order any components for technology, old or new.

Thus, counterfeit parts show up in virtually every industry. Though strides are taken to prevent them from entering the market, it is impossible to catch them all. Even supposed reliable sources are not immune to this deception and often mix counterfeit parts with genuine components to “pad” a shipment. These substandard parts can cause problems in product performance and reliability as well as pose possible safety risks. But why do suppliers practice this deception? The answer is money, of course. If you consider a part has a value of $90, and there are 1,000 parts to a shipment, even a small percentage of “padding” can net a supplier hundreds of dollars from a single order.

Once an order arrives, manufacturers do make efforts to sort out the good from the bad and perform secondary inspections before installation. But how is that done with 100% accuracy? It’s not easy. Many components are encased or flush-mounted, so a visual inspection is nearly impossible. Counterfeiters go to great lengths to try and pass off these false items, down to matching serial numbers and identification markings. Current estimates for the annual loss to the electronics industry due to counterfeit components is north of $5 billion.

With numbers that high, it is not surprising that criminal enterprises are getting more and more sophisticated in their attempts to cash in on counterfeit parts. In the past, efforts to detect these counterfeits were not very effective. Testing performed a few years ago proved this when cases of components were intentionally shipped to five testing facilities that included a mix of genuine and counterfeit parts. The average miss of the bad parts was one out of five. If those components were headed for the military or a major airline, failure of one component could have disastrous consequences.

Therefore, the best solution is to implement a standard operating procedure (SOP) to detect counterfeit electronic components before installation. Working with a quality control partner ensures these risks are mitigated, which is where X-ray has proven to be invaluable. X-ray technology has evolved to a level where specialty machines scan individual parts, or reels, to be counted with specialty software. More important than merely counting, this software will alert a technician when an anomaly is discovered so that counterfeit parts can be identified. Due to the evolution of this software, many of these machines have as good as a 99.9% accuracy rate in finding suspect parts.

This is important because no matter how well a device is designed and manufactured, it is only as good as the components that make it work. If these parts underperform or break, the overall performance of the unit is compromised or, even worse, fails. That is not as much of a problem with a stereo system, for example, but in aerospace, military, and medical applications, a device malfunction can be deadly.

By utilizing X-ray technology, manufacturers can greatly reduce the doubt over the component’s authenticity. Taking such precautions will help guarantee product meets safety standards and avoid the chance of safety risks to a company's workers, customers, and others who handle them. 

Dr. Bill Cardoso is CEO of Creative Electron.


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