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What Happened to All the Counterfeits?

The number of counterfeit chips flagged by the Electronic Resellers Association International fell significantly over the last year despite the semiconductor industry’s recent boom. What remains unclear is whether the business has slowed or counterfeiters have improved their tactics, concealing fakes from companies and customs agencies.

Counterfeits sneak into the electronics market through distributors and manufacturers that fail to screen them for authenticity, and generally fakes flood the market during component shortages. The organization flagged more than 750 components suspected of being counterfeits last year, down from the 1085 average over the last five years. One-third of the parts had been reported in previous years.

The trade organization warned against jumping to conclusions about the results. Government agencies may be intercepting more fakes. The other possibility is that companies are simply not reporting them. New ways of detecting counterfeits could be running fraudsters out of the business, or the counterfeits are so sophisticated they have remained undetected.

Xilinx, the largest supplier of field-programmable gate arrays, was targeted by counterfeiters more than any other company, accounting for 13.5 percent of the chips flagged over the last year. It was followed by Intel with 10.6 percent, Analog Devices with 5.2 percent, and Texas Instruments with 4.5 percent. Counterfeiters faked programmable chips designed by Xilinx and Intel—more commonly called FPGAs—more than any other type of component (20 percent).

Those chips were also targeted by Rogelio Vasquez, the owner of an independent distributor allegedly selling counterfeits as new parts manufactured by Intel, Analog Devices and Xilinx. In May, he was charged with changing the date codes, lot codes and countries of origin of the chips altered so that they looked newer than they were. He also allegedly falsified paperwork that would have flagged them as fakes.

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