What To Do With Counterfeit Products?

21 February 2020

Read our latest blog from NQA's Aerospace and Automotive Director, Mike Venner, on how you can manage risks and what to do if you come across counterfeit products/material and how to identify and avoid them.

I think the awareness of counterfeit parts and to a degree what you can do to avoid counterfeit parts is getting better but I often ask the question during assessments: “So what would you do if you did identify counterfeit parts/material”? The answer I get is that they don’t know.

All clients are pretty aware that they do not send counterfeit parts back to the supplier as that will make things worse but outside of that there is a lack of awareness so I will highlight what you should think about doing.

I recommend you put some guidelines within your management system!

Step 1 - Receipt and Control

Most of the counterfeit products/material will be identified upon receipt into your premises, not all but most.

The most important thing here is controlling the items so they do not enter into your production or stores area to be used. The products/material may not be confirmed as counterfeit but you should assume it is if there is any doubt and treat it as such. The parts/material would be classified as 'Suspect Counterfeit' until it is confirmed either way.

Your management system should already identify the controls required but you need to ensure that the suspect parts/material is clearly identified (preferably with some big red tags) and put into a secure area. Many organizations will have a locked quarantine cupboard which is your safest option for preventing it from moving any further.

Step 2 - Investigate and Determine

I have written a number of articles and hosted a number of webinars in the past so I won’t go into great detail on what you need to do in order to investigate counterfeit parts/material but I will highlight a few key things you can do...

Whatever you do, under no circumstances send the material/products/components back to your supplier if they are suspect or deemed counterfeit as that will just come back into the supply chain.

Fraud indicators may fall under three categories:

Document indicators of fraud
Part (or physical) indicators of fraud
Facility indicators of fraud

Document indicators

Part (or physical) indicators

Parts can have the following significant physical indicators of fraud:

Appearance
Performance
Other indicators

Facility indicators

Raw Material

As a minimum you need to be checking the documentation and packaging as a matter of course but you can also go further with your identification and verification of purchased products with NDT and DT.

Some of the NDT and DT processes can be expensive which is what puts some organizations off but if you are risk assessing your suppliers and applications correctly then you do not need to do this very frequently. The cost outweighs the punishment and risk.

Visual

Altered or unexplained markings, stampings, moldings, and engravings.
Improper surface treatment or signs of refurbishment without being identified as refurbished materiel.
Re-marked, smeared or illegible bar codes (IUID or UII)
Faceplates and nameplates showing signs of removal and re-installation
Altered labels and tags
Signs of re-painting or re-coating
Other signs of re-used materiel such as oil stains, overheated areas, signs of disassembly and reassembly, erosion, wear, dents and scrapes, etc.

Documentation and Packaging

Lot and/or date codes on the packaging do not match the lot and/or date codes on the parts.
Review of logos, trademarks and other identifying marks to ensure they match manufacturers’ marks as applicable.
Changes to or irregularities in the documentation and/or paper trail.
Part number marked on the materiel does not match the part number on the Purchase Order and the certifications.
Materials are inconsistent with the description on the supplied documentation.
Serial number issues or duplication of UII (Unique Item Identifier).

Non-Destructive Testing and Destructive Testing

Visual, Weight, Optical and Infrared
Liquid Penetrant Inspection
Magnetic Particle Inspection
Ultrasonic Inspection
Eddy Current Inspection
Radiological Inspection
Thermography Inspection
Acoustic Emission
Holography/Shearography
Heat Flow Microcalorimetry
Functional test
Destructive: deformation, mettallurgical, exposure, analytical, functional

Electronic Components
82% of all known counterfeit products are electronic components. As a minimum you need to be checking the packaging and performing a visual inspection and it is highly recommended you also perform some of the Destructive Testing. Again though, this should all be based on risk.

There are many tools and techniques you can apply to electronic components to help identify counterfeit. One of the best methods is to send a sample back to the OEM/OCM if you have not bought directly from them or one of their authorised distributors, they will know the product better than anyone else and will be able to tell you if it is counterfeit or not.

Documentation and packaging
External visual inspection
General
Detailed
Remarking & resurfacing (destructive)
Radiological (X-ray) inspection
Lead finish evaluation (XRF of EDS/EDX)
Delid/dacapsulation internal analysis (destructive)
Scanning electron microscope
Quantitative surface analysis
Thermal testing
Electrical testing
Burn-in
Hermeticity (fine and gross leak)
Scanning acoustical microscopy

Step 3 - Inform the Authorities and Customers

This is the part that often confuses organizations, they don’t actually know who they are meant to inform and what happens next.

Firstly, you need to inform your customers as they will be impacted by this situation with either delays or recalls. They should be kept up to date with your investigations and any actions you are taking as a result.

The authority part is not as easy but you should know yours based on where you are located. In the UK you would contact the EASA, they may put you in touch with the CAA but your first port of call should be the EASA. In the USA it would be the FAA. You need to know the authority within your own country!

The EASA website has over 7500 known counterfeit parts listed on their website, you should use this website to check to see if any of your purchased items are on this list and you can also subscribe to receive notifications of new issues. They also have a list of parts currently under investigation and you can read what action is being taken.

Whatever authority you contact they should all take similar action and investigate further, they will take any necessary actions

You should also contact ERAI and GIDEP

ERAI

Founded in 1995, ERAI, Inc. is a global information services organization that monitors, investigates, and reports issues affecting the global electronics supply chain. As the industry’s leading source of risk assessment tools, ERAI provides exclusive services and in-depth information that enable its members to perform industry-specific risk mitigation on suspect counterfeit, high-risk, and non-conforming parts and identify problematic suppliers and customers.

Among ERAI's host of risk assessment tools is the world's largest database of suspect counterfeit and nonconforming electronic parts.

GIDEP

GIDEP (Government-Industry Data Exchange Program) is a cooperative activity between government and industry participants seeking to reduce or eliminate expenditures of resources by sharing technical information essential during research, design, development, production and operational phases of the life cycle of systems, facilities and equipment.

Reporting to GIDEP will allow for global communication of known counterfeit issues.

Conclusion

Counterfeit is a big problem in the aerospace industry (and others to that point) and if something is counterfeit and installed on an aircraft the repercussions could be catastrophic. Every organization needs to be vigilant and play their part in reducing the amount of counterfeit materials in the industry.

Even if you are not sure that something is counterfeit or not you should inform the authorities, they will support you in the investigations and conclusions. It is better to be safe than sorry!

To watch to some of my previous videos on counterfeit parts click here.
To sign up to any future webinars or workshops keep an eye on this page.

If you would like more information on this subject or to speak to a member of the NQA team you can email us here or call us on 800-649-5289.