back to article US, EU seize counterfeit computer goods

More than 360,000 fake computer chips and network components were seized by US and European custom officers in a joint operation late last year. Officials from both sides of the pond seized counterfeit goods that carried more than 40 different trademarks in November and December last year under “Operation Infrastructure”. It …

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Anonymous Coward

So about 0.03% again

So say $20 a chip, $6 million in this worldwide op.

Chips market is worth about $20 billion a year, so that makes counterfeits 0.03% of that. When you say 360000 it sounds so huge, but I bet the worldwide operation that netted $6 million in counterfeit chips cost upwards of $20 million.

OECD claims 2% of all cross border trade is counterfeit goods (they pulled a number from the air and Customs use it to justify their budget), but whenever they do this it shows you how small this problem really is, 0.03%!

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Flame

counterfeit what?

counterfeit cisco routers? counterfeit ATI gfx cards? How can these be counterfeited???? please some one tell me? Please? Please?

Plug em in and they dont work? box with sticker on it?

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Tom
Coat

Eh?

Why would immitation fried potato sticks perform medical procedure on a piece of bound loin?!?!

Mines the abidas 4 stripe...

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Anonymous Coward

@counterfeit what?

"counterfeit cisco routers? counterfeit ATI gfx cards? How can these be counterfeited???? please some one tell me? Please? Please?"

They include remarking in that number. i.e. a chip rated at 1.6ghz is remarked as a 3.2ghz and resold. Can't imagine that's really a counterfeit thing, but it's included in the number anyway.

Not sure what other tricks they've pulled really, product makers usually only buy from existing suppliers that they have a long term deals with. I can't imagine they go to Mr Chang on Camden market to buy the chips they planned to make their product with!

360k, say 120 chips per PC, that would be 3000 PCs worth, i.e. 1.5e-5 th of the market.

Seems about right to me, imagine a few PC assembly shops not knowledgeable as to which are the reliable suppliers, they might buy from bad suppliers, have problems, go out of business, I bet that is 1.5e-5 th of the market...

Yeh, but it sounds great if you say 360,000 chips (did they count the individual chips in a 20 chip fake ram DIMM?). Even better if you say that in total the raid covered 2 weeks (makes it sound like the number should be 25x bigger each year and not that this is the culmination of a year of planning!).

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Dead Vulture

RE: counterfeit what?

Good question Fred.

Names please. Explanation please. Repeating a government PR release not good enough.

Has someone been overfeeding the vulture? Fat, lazy vultures are not attractive.

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Re: counterfeit what?

I reckon it's things like usb flash drives and the like.

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Unhappy

It happens.

One of my companies was hit by counterfeit network parts: to be exact, Ethernet sockets that had been silently substituted by fakes, by a Hong Kong component supplier. It's lamentable, but it's a known problem that can happen in Far Eastern manufacture. If you're trading in that environment, you've got to have your head up.

I'm delighted that the fraudsters are starting to be targeted - and relieved that we discovered the substitution before we went to mass production.

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Coat

semiconductors

Counterfeiting semiconducters is biiiiiig business.

There are multiple mechanisms : relabeling parts to a higher clockspeed ( especially memories ! and of course cpu's )

Parts that were destined to be scrapped ( out of spec devices. for instance a procsoor in idle is supposed to draw no more then 60 mA. due to process variations some draw 100 mA. these are rejected. even though they work normally they are 'borderline and prone to early failures . manufacturers dont; want these out on the streets becaue they will come back as returns under warranty !. whole truckloads of such things get stolen .labeled and sold ( such devices are not labeled )

rebranding parts. selling cheapass memories from vendor x , and labeleing them with the name of a premium vendor.. instant $$$ ...

And then plain counterfeits. 4gb flash chips that only contain 2 gb ...

this happens with parts that are in short supply. all fo a sudden 'someone' ( mostly in the far east' has a lot of a couple of thousand parts that he 'no longer will use' becasue the product he used them in has been cancelled. so they end up on auction sites ...

Assembly houses that need parts and can;t get them in time may be tempted to buy whatever they can get to keep production flowing.. and sometimes get royally shafted by such 'brokers'. by the time yiou want to file a complain the broker has dissappeared. company closed , office turned out to be a answering machine tied to a cell phone in a trainstation locker somewhere ...

sometimes its parts that are sold as leadfree but actually are relabelled parts with lead in them !. someone had a huge stock of a certain part that is in high demand . unfortunately its a part that is not RoHS compliant. simply relabel them and sell them as RoHS compliant !. buy cheap . sell at full price. instant $$$

if you want to know more : here are some websites with examples of counterfeit chips.

http://www.designchainassociates.com/counterfeit.html

this webpage has pictures and real examples of counterfeit parts :

http://www.eetimes.com/showArticle.jhtml?articleID=201201791

its a real plague, both for buyers (they get wrong parts or altered parts with lower reliability or unusable parts like not rohs compliant parts) and manufacturers becasue they get a bad name or have to deal with stuff that returns under warranty ....

So there you go, now you know. I am working in the semiconductor business and have personally seen 2 different counterfeits.

Mine's the Class-i Cleanroom Suit.

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Tom
Silver badge
Pirate

I've seen some of this crap.

Take a cheap no-name memory module (<$20 retail), add some fake CORSAIR stickers and put two into a fake CORSAIR matched pair kit packaging and it now looks like an $80+ product.

Anything where you have cheap no-name and expensive name brand is ripe.

I've seen fake network switches, they fake the case to look like a well known name brand and use the board from a cheap no name inside. Crap no name DVDs labelled Taiyo Yuden...

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Pirate

Or how soon we forget

Or how soon we forget , the simple fact is since chips are either made on eight or twelve inch dies by the hundreds and to the same game plan ! The makers merely test each batch to obtain a certain quota number to the premium clock speed so they can profiteer from the limited production run and then test certify the balance at progressive lower speeds quotas and on up to the super cheap tight ass end of the market who won't part with an excessive amount of pesos if they can't help it!

After all , the profit from say 100,000 or ten percent of production ,then on selling them for $800 a piece is far more profitable then selling a million chips that cost the same $15 at $20 ! and so it goes on !

Although apart from some easily bypassed coder tricks the el cheapo ass end product can be induced to run at higher clock speeds then marked !

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Anonymous Coward

Then where do they sell them?

"Take a cheap no-name memory module (<$20 retail), add some fake CORSAIR stickers and put two into a fake CORSAIR matched pair kit packaging and it now looks like an $80+ product."

I wonder where they would sell those, given the dominance of a few electrical retailers? Fake DVD's, yeh, I guess in the marketplace, car boot stalls etc. But where can they dump counterfeit CORSAIR ram and why wouldn't the buyer notice all the missing packaging?

I also have to add another point. Do CORSAIR make chips or are they another badge operation (you know buy parts in Taiwan, stick a few labels on them then sell 'matched set' i.e. the same spec chip as the company sells)? Because those (the rebadgers) I have the least sympathy for, they lay themselves open to being cloned because their contribution is nothing but badge and marketing and the occasional go faster stripes.

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Anonymous Coward

Primarily a Quality issue

Although the impact for Joe Bloggs is likely to be poor reliability, counterfeiting has major implications for safety (planes, cars etc).

Just cause plod hasn't been doing his job properly (remind me again, what are we paying them for?), doesn't mean its not happening.

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Stop

NEVER buy memory from an unknown supplier

I would never ever buy memory from an unknown supplier, only major retailers, it is far too easy to get stung buying from eBay et al.

As for memory flash drives, there is software on the net that you can use to tell them they are a greater capacity than they are, it is most useful for reprogramming the 4GB stick you bought back to the 1GB it actually is.

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Anonymous Coward

@semiconductors

Thanks for the explanation. I'll keep those links.

And thanks also to Tom.

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Anonymous Coward

Wait that should be 0.0024%

According to one of those links in the semiconductors comment that says the market for semiconductors was $252 billion in 2007.

So that's 0.0024% of the market.

I remain unimpressed and fail to see why the company that bought and used that more expensive Intel Flash chips in it's products when it was actually supplied with remarked Samsung Flash chips, doesn't sue the supplier like any other failure to supply the goods.

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Happy

Cheers

Thanks for that guys.

I didnt realise it was that bad.... and rebadgers do my head in as well.

I'd be pretty cheesed off if i bought something that turned out to be like that.

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Paris Hilton

Numbers don't mean anything

"I remain unimpressed and fail to see why the company that bought and used that more expensive Intel Flash chips in it's products when it was actually supplied with remarked Samsung Flash chips, doesn't sue the supplier like any other failure to supply the goods."

Try it sometime ... first you have to prove that the chips are bad and if you've just wave soldered 10,000 chips at $8 each into a product then you have a big problem... pull them off the board and start testing ... call the supplier and they will swear up and down that they sold you good stuff and you ruined it, or that the parts that you are returning aren't the parts that they supplied.

Been there, done that, didn't get anywhere. Did we report it? Hell no - we don't use that supplier any longer although we've had other kit from them that appeared to work. We're doing more QA now but that costs money ... so either our margins are lower or our kit is going to have to cost more.

It doesn't matter what fraction of a percentage is duff kit - when it's 100% of your production line you have a big problem. Most of the time when counterfeit kit is discovered it's junked and the affected manufacturer moves on ... there's a lot more duff kit out there than you suspect.

Simple answer - stop buying from suppliers that you don't trust ... we used not to trust any Chinese suppliers, that's now expanded to no Asian chip suppliers. But when you have a board run halted because your regular supplier hasn't shipped to you it's tempting. Most of our kit is high spec analog so testing isn't quite as simple as testing digital chips.

Anonymous for obvious reasons. Paris, because I think shes got some counterfeit parts ...

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Gold badge

How?

They get very cheap network cards and rebadge them. They get low end CPUs and repackage them.

Maybe the Real Hustle team should show us how?

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Stu
Pirate

Sony Mem stick duos on Ebay?

So all this must fall under the same category as buying a memory stick for your PSP off Ebay from the far east - comes with a badly printed sticker made up to look like an official Sony stick, but clearly isnt.

Going by the number of auctions of such cards, I'd wager a very large amount of counterfeit computer chips flow through Ebay - remember they're meant to be a large legitimate totally legal organisation, they end up profitting directly from listing revenue from illegal items.

The scumbags.

El-Reg - write an article as a follow up about how Ebay are profiting from criminals - and are so crims themselves. Been done already?

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Unhappy

Cheap, fake, capacitors

Hi, millions of stolen electrolytic formula caps were sold and are in all kinds of electronic equipment since about 2000. So if you have a computer resetting or won't turn on, check the motherboard for bulging caps. Seems the thieves forgot to steal the gas inhibiting formula and the caps all form hydrogen and explode, bulge and leak. Check it out on www.badcaps.net. We do the repairs at www.lynncomp.com Fixed 3 in last 3 months, from Jetway cubes to Compaq computers. This is a really big problem, and if you see it, have caps replaced.

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