Just like Gucci or Coach handbags, counterfeiting electronic parts is big business overseas and it causes major problems in the printed circuit board component supply chain. Counterfeit electronic components that are sold as genuine can affect everything from your new electronic alarm clock to mission-critical military systems, such as thermal weapons sights, missile guidance systems, and aircraft. Whenever electronic parts are relabeled or remarked, the end user suffers, product designers suffer, and thieves get away with your money.
Like fake money, there are fake electronics circulating within the market, waiting to come into your possession and ruin your day. These are sold as if they are legitimate, and unlike money, there’s no magic marker you can run over them to check their authenticity. There is no sure-fire way to eliminate your exposure to counterfeit electronic components, but you can reduce the risk that these parts end up in your product.
Wait, Does This Even Affect Me?
Often times, you won't know whether your device contains counterfeit products unless you thoroughly check a fabricated and assembled board, or until a critical system fails and is inspected. In reality, everyone is at some risk of including counterfeit parts in their products. However, there are simple steps anyone can take to reduce their risk while simultaneously improving the quality of their end products.
The consequences of including counterfeit electronic parts are severe, regardless of the size of the operation. For smaller companies, this could mean falling months behind schedule because of the time spent replacing parts that were questionably sourced. For larger companies, projects run the risk of going over budget by hundreds of thousands of dollars, sometimes millions, due to the time spent identifying counterfeit parts. If you aren’t convinced that losing 7 to 9 figures is worth the effort of screening for counterfeit products, just wait until your assembled board goes up in a puff of blue smoke, or worse.
There are major concerns over counterfeit electronics in federal contracting, especially in the defense industry. If you do work for the government, training to protect against counterfeit devices is mandated by certain acquisition policies. For those of you lucky enough to avoid the jargon-saturated slideshow flogging, it’s worth having a little background information to protect your products and reputation.
Reputable companies should go the extra mile to inspect their components prior to shipping completed products to their customers. They should also take the time to replace or recompense customers, even if only partially, in the event that counterfeit components create a major failure in a critical system.
Risks of Counterfeit Electronic Components in PCB Design
There are two main flavors of counterfeit electronics. This first is outright fakes, where a part is relabeled and sold as something completely different. When you think about it, this is actually quite easy; many integrated circuits with completely different functionality may be sold in the same package (e.g., DIP packages). It is a simple matter to remove the real component label and replace it with a completely different label for a more expensive product.
The second is called remarking, where counterfeiting operations relabel parts as higher quality products and sell them to unwitting customers. They can wreak havoc on your designs, security, budget, and schedule. For example, parts that may have failed or tested below their specified tolerances can be remarked as a higher grade than they actually are. Repainting the 10% silver tolerance band on a resistor to 5% may not have a noticeable effect in most products. Unfortunately, this is happening with integrated circuits, microcontrollers, FPGAs, and other electronic components that form the cornerstone of critical systems.
Fake electronic parts can pass a quick x-ray inspection or a visual inspection; the exterior and interior may appear normal to the untrained eye. It isn't until suspect electronic parts are examined for their electrical functionality and compared with the specifications in datasheets that one can determine whether the component is a fake. With integrated circuits, an x-ray inspection or a microscopic inspection may not be sufficient unless you directly compare images from a real component and from the suspected fake component.
There are three main concerns:
Infringement: It’s illegal to falsely represent a product. This applies to both the original counterfeiter and your company. You are liable for your product’s legitimacy and may face consequences if your system is falsely advertised.
Security: In my security-centric jobs, it was forbidden to use USB drives from conferences with work computers or documents because of tampering concerns. The same rule applied to using microcontrollers and other complex integrated circuits that may have nefarious modifications (“nefarious” is actually the word used, so you know it’s bad).
These modifications give third parties unauthorized access to intellectual property, sensitive data, or other secure information. In addition to catastrophic security ramifications, they can cause widespread system malfunctions.
Performance: Counterfeit components have lower quality and performance. Sometimes they don’t work at all. In the most nefarious cases, they are designed to fail intentionally.
With Respect to Critical Systems:
Obviously, system failures and malfunctions are a major risk for any critical system. In particular, products that someone’s life depends on are held to strict standards. High performance/reliability systems (usually medical, aircraft, and defense) are advised or required to adhere to SAE’s Standard AS5553.
These requirements apply to many products produced under federal contracts, especially subcontractors with trickle down requirements and small businesses. Keep in mind that I’m a hardware nerd and not an acquisition specialist, so the legalese should be reviewed by someone with the appropriate qualifications.
With Respect to Consumer Systems:
Performance issues can be devastating for any system, even if they don’t control life or death situations. This is particularly important for startup companies with a limited budget. I’ve seen startup funding rounds missed because early failure rates ruined demos and customer relationships.
How to Identify and Avoid Counterfeit Electronic Components in PCB Design
Now you’re all fired up and ready to tackle this issue, where do you even start? Where do your components come from? There are three main sources:
Original component manufacturers: Call them “OCMs” when asking questions at big presentations. This will let everyone knows that you’re underwhelmed by the powerpoint fear tactics. OCMs are the companies that make the electronic components. They are at the top of the supply chain. If you are ordering wholesale or in huge batches, then you can sometimes buy components directly from an OCM. If you aren’t, then you’ll probably buy from…
Franchise distributors: I’ve never heard them called “FDs,” but give it a try. These guys have specific contracts to sell officially sourced parts from OCMs, and they should have solid documentation regarding sourcing.
Brokers, wholesalers, independent distributors: There’s a huge range of legitimacy at this level of the supply chain. While cheap, a random guy on eBay is probably at the low end of this range. This doesn't mean some guy from Michigan named Steve is counterfeiting parts, but he may be unwittingly reselling counterfeit parts to you. Independent brokers are the source of most counterfeits, although they may resell to distributors who have no idea of the shady origin of some components.
Learn How to Inspect Your Components
When counterfeit electronics are a concern, you should source components yourself. This gives you the opportunity to inspect if necessary. Identifying counterfeit electronic components can be difficult, but there are several approaches you can try.
In order of cost and complexity:
Visual inspection: Look for resurfacing, sanding, or refinishing where labels were removed and repainted. Sometimes an acetone swab will completely remove a fake label.
Microscopic visual inspection: Check the surface of packaging and solder points for smoothness and consistency between different .
Inspecting a circuit board for counterfeit components can be tedious and time-consuming.
Electrical testing: Power a device up, and make sure the I-V characteristics match the manufacturer data sheet. There are other aspects of integrated circuits that need to be inspected, such as noise levels, jitter, switching speed, and other aspects. Usually, you will need custom test fixtures for surface mount components. This is tedious on large batches but is a dead giveaway for that are remarked.
X-ray inspection: Again, you will be comparing seemingly identical parts. Fakes usually have different wire bonding and internal variations. You can also remove the packaging from parts to inspect their structure without an X-ray, but this is a very destructive option.
X-ray spectroscopy: If you really need this level of inspection, check out local university materials science programs. Some will partner with your industry or test your components for you. I advise you to look for lead, as counterfeit rarely live up to RoHS compliance. This doesn’t help for military grade parts that require lead solder.
Advanced microscopy and marking: DARPA and other groups have spent a lot of money on counterfeit detection solutions. These include obscure DNA-based dyes, scanning acoustic microscopy, and other techniques that identify counterfeit electronic components without destroying real ones. You’ll need some serious expertise on-hand to run these counterfeit detection measures.
Use Authorized Distributors
Your best bet is to source directly from authorized distributors. In defense applications, there are actual lists you need to keep track of. For the rest of us, it comes down to maintaining internal databases of approved distributors who are transparent about sourcing and verification.
A great way to keep track of electronic components is by using Altium Concord Pro® in conjunction with your Altium Designer® to manage component databases. This will make it easy for your designers to only use from authorized distributors and gives you supply chain traceability (more Fed-speak for who sold you the goods). Your documentation and reporting requirements are easily met if you do have a run-in with counterfeit parts. You can learn more about how Altium can help protect your PCBs and finished products from counterfeit electronic components by contacting their specialists.