Fighting a Flood of Counterfeit Tech Products

“Edward Dimmler dips a cotton swab in acetone and rubs it on the
surface of a computer chip that was ostensibly manufactured by
Samsung. The white tip turns black—the first clue that the
part may be fake. Dimmler, director of warehouse operations at
electronics distributor PCX, then inspects the chip under a
microscope and sees the word Samsung smeared across the top of the
chip. Clearly, this memory chip is counterfeit, ineligible for
resale. Dimmler quarantines it in the bowels of his warehouse on
one of the shelves painted red to denote knockoffs of well-known
brands, including Intel (INTC), Advanced Micro Devices (AMD), and
NEC. “We now have to question everything,” he says in an interview
at PCX headquarters in Huntington Beach, Calif. “A part is
considered suspect until we prove otherwise.”

“In the past five years, counterfeit computer chips, routers,
and other electronic products have “become an epidemic,” says PCX
Chief Executive Gil Aouizerat. The number of counterfeit electronic
products uncovered in the defense industry alone more than doubled
in 2008 to 9,356, from 3,868 in 2005, according to a January 2010
report by the Commerce Dept. Fake gear costs the information
technology industry an estimated $100 billion a year, according to
the National Electronics Distributors Assn”

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