The federal government and the defense industry are enacting new policies and practices to prevent the introduction of counterfeit components into supply chains along with methods to detect them should they slip through yet, despite several attempts, no federal e-waste recycling mandate currently exists.
Two previous bipartisan bills were introduced which would forbid U.S. companies from exporting e-waste: H.R.2284 - Responsible Electronics Recycling Act (introduced June 22, 2011) and H.R.2791 - Responsible Electronics Recycling Act (introduced July 23, 2013). Both versions of the bill died.
On June 24, 2016 Rep. Gene Green (D-TX) along with Rep. Paul Cook (R-CA) launched a third attempt to stop the flow of electronic waste to China and other countries known for producing counterfeit electronic parts by introducing H.R. 5579, the Secure E-waste Export and Recycling Act (SEERA).
We need broad industry support in order to pass this legislation.
It is 2016: fifteen years since China was admitted to the WTO and the
first counterfeit part was reported to ERAI; a decade since ERAI’s
President made a second trip to China to see firsthand how e-waste was
being used to fuel what has been referred to as a counterfeit
epidemic; and nine years since I wrote ...
On December 10, 2015 three Chinese nationals (DAOFU ZHANG, 40; JIANG GUANGHOU YAN, also known as “Ben,” 33; and XIANFENG ZUO, 37) were arrested on federal criminal complaints in connection with a scheme to obtain and illegally export sophisticated semiconductors stolen from the U.S. Military.
ZHANG, YAN, and ZUO operated businesses in China and elsewhere that engage in the purchase and sale of electronic components, including integrated circuits. Federal law enforcement agents began investigating YAN and a Chinese company known as HK Potential
in 2012 for trafficking in counterfeit semiconductors. In October 2014 and in March 2015, YAN sold a total of 45 counterfeit Intel microprocessors to an undercover agent who had advised YAN that the components would be used on a U.S. Navy contract involving submarines.
On July 28, 2015, after an extensive, multi-year investigation involving the Defense Criminal Investigative Service (DCIS) and the U.S. Department of Transportation, Office of Inspector General, Jeff Krantz pleaded guilty to supplying falsely remarked Intel microprocessor chips, many of which were used in U.S. military and commercial helicopters.
Krantz, who pleaded guilty to one count of wire fraud, was sentenced on December 10, 2015 to three years' probation and fined $100,000.00. He was also ordered to pay $402,650.00 in restitution.
As part of his guilty plea Krantz agreed to a two-year ban on the purchase or sale of electronic parts. He also forfeits all direct or indirect control over his company, Harry Krantz LLC, authorities said.
A Massachusetts man was sentenced today to 37 months in prison for importing thousands of counterfeit integrated circuits (ICs) from China and Hong Kong and reselling them to U.S. customers, including contractors supplying them to the U.S. Navy for use in nuclear submarines.
On Tuesday July 28, 2015 the Department of Justice announced that Jeff Krantz, the former CEO of Harry Krantz LLC, entered a guilty plea to supplying customers with falsely remarked microprocessor chips.
A copy of the DOJ press release and a response from The Harry Krantz Company is included below.
Peter Picone pleaded guilty to Count Two of eight-count indictment charging him with conspiracy to intentionally traffic in counterfeit military goods in violation of Title 18, United States Code, Section 2320(a)(1). Despite acknowledging his participation in the conspiracy was inexcusable and an apology, Picone is now asking for a non-incarceration sentence of house arrest and probation and a downward departure based upon “Diminished Capacity”. It is Picone’s claim he suffers from a severe panic/anxiety disorder, deep depression and Post Traumatic Stress Disorder (PTSD) which made it virtually impossible for him to effectively process information or differentiate between reality and fiction.