The Electronic Part Supply Chain and Risks of Counterfeit Parts in Defense Applications

The DoD is concerned about having trusted sources for manufacturing leading-edge new microchips. It is just as important, if not more so, to maintain high quality standards and traceability of all microchips, including legacy chips, which form the backbone of our fighting and defensive hardware in all the services. The business models for brokers are not compatible with the need for a trusted supply chain for national security applications. Not all brokers are unscrupulous or offer substandard or counterfeit parts. However, it is impossible for the DoD to make an a priori judgment of the parts bought through brokers. It is too risky to include brokers in the supply chain. Some recommendations follow to ensure that trusted supply chains are available for policy decisions of the DoD: 1) The DoD and DoD contractors must buy direct from manufacturers or authorized distributors only. 2) Rules need to be implemented that force the DKSP to only list manufacturers and distributors who exhibit proper authorizations and certifications. 3) Action must be taken to insure government agencies and contractors buy certified parts from certified suppliers for quality, traceability, and safety reasons. 4) All requirements must be removed that demand part purchases from small, disadvantaged businesses when they are not authorized by an original manufacturer. 5) All unauthorized brokers must be excluded from attending and marketing at government sponsored conferences. Following these policies will help in mitigating the risk on inclusion of counterfeit and other substandard parts in the national security systems at the system integrator level. To tackle the problem of counterfeiting at the sources, other parallel technical, legislative, law enforcement, and logistical measures need to be undertaken