Counterfeit Chips Threaten Weapons System FailuresOctober 17, 2008

 

A counterfeit chip from China is found in the flight computer of an F-15 fighter jet. Phony Chinese routers, marked as Cisco-built, are used in U.S. defense networks. A three-month long investigation by BusinessWeek discovers vast quantities of fake microchips from unregulated Chinese bazaars that are flowing through shady brokers into U.S. military weapons and networks, raising the threat of potentially fatal malfunctions in equipment and cyber espionage.

As many as 15% of all spare and replacement microchips the Pentagon buys are fake, according to Robert Ernst, who investigates counterfeit parts for the Naval Air Systems Command's Aging Aircraft Program in Patuxent River, Md. Weapons systems are failing regularly in the field and he believes fake parts almost certainly play a role in those accidents. The counterfeit routers have security experts (and the FBI) even more worried because they may contain hidden 'back doors' that would allow hackers and spies to access sensitive military data.

While there are no known cases linking these counterfeits to serious accidents or documented hacks, the number of fakes infiltrating the system is especially disturbing because the defense and aerospace industry is increasingly turning to legitimate electronics manufacturing services providers to source the electronics and computer circuitry that goes into U.S. military hardware. As a recent article posted on the Wharton Aerospace and Defense Report noted, outsourcing in this space was about $2.8 billion in 2006 and is expected to grow to $4.4 billion by 2011, according to Technology Forecasters, a research firm in Alameda, Calif. Having fakes muddying the picture could complicate this growing form of outsourcing.

According to the BusinessWeek report, published October 2, 2008, contractors often receive old commercial grade chips disguised as new military grade chips. The report also notes that many chip makers and contractors say that it is not their responsibility to police these unruly marketplaces. But others are exploring ways to counter this growing menace.