Reports of counterfeit parts have quadrupled since 2009

Summary:Another record here is that 2011 was the first single year that saw the total number of reported counterfeit incidents exceed 1,000, according to a new report.

Reports of counterfeit parts have quadrupled since 2009 -- the last year where there was actually a decrease in reports from the previous year -- according to a new report from IHS iSuppli.

Specifically, there were a reported 1,363 separate counterfeit-part incidents worldwide, up from 324 in 2009.

These claims have stemmed from supply chain participants such as OEMs, contract manufacturers, and component suppliers and buyers, among others.

Another record here is that 2011 was the first single year that saw the total number of reported counterfeit incidents exceed 1,000. These kinds of reports have risen by almost a factor of 700 over the last 10 years.

Rory King, director of supply chain product marketing at IHS, explained in the report that the counterfeit issue is plaguing electronics manufacturers -- especially those working in the military and aerospace industries.

The problem has grown increasingly hard to ignore, as reports of counterfeits have risen exponentially and most companies lack the awareness and capability to effectively detect and mitigate the growing problem. The reporting done by the industry can help other organizations pinpoint risky parts or suppliers. And now that United States legislation will hold defense suppliers accountable for counterfeit issues, access to these incident data becomes a critical decision-support capability for business systems.

There are many dangers involved with counterfeit tech parts. Along with the data security issues, lives are also at risk as the report explains counterfeit parts often are usually cheap substitutes or salvaged waste components don't adhere to strict military and aerospace specifications, leading to potential failures.

Failure is not a word one wants to associate with aerospace and military technology.

IHS also points out that the financial costs for each individual incident are quite high, with one totaling as much as $2.7 million to fix.


Topics: Apple, Samsung, Tablets


Rachel King is a staff writer for CBS Interactive based in San Francisco, covering business and enterprise technology for ZDNet, CNET and SmartPlanet. She has previously worked for The Business Insider,, CNN's San Francisco bureau and the U.S. Department of State. Rachel has also written for, Irish Americ... Full Bio

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