@Risk

The US Department of Defense has concerns about counterfeit parts in its supply chain and is now taking additional steps to ensure that its equipment and parts are authentic.

According to the American Forces Press Service, the DOD has implemented a quality assurance process to identify material that doesn’t conform to standards and determine which ones are counterfeit.

For the DOD, most of the problem appears to center on previously used parts sold as new. As Senator Carl Levin (D-Mich.) explains in a statement:

In some industries, the term “counterfeit” suggests an unauthorized fake, a knock-off of an original product. The definition of counterfeit, as it relates to electronic parts, which has been endorsed by the Department of Defense and defense contractors alike includes both fakes and previously used parts that are made to look new, and are sold as new. Previously used parts sold as new parts present a significant risk because, while they may pass initial screening, they are far more likely than new parts to exhibit reliability and performance problems later on when deployed in the field.

Sen. Levin chairs the Senate Armed Services Committee (SASC) which this year began an investigation of counterfeit electronic parts in the DOD supply chain. In his statement, made at a SASC hearing last week, he goes on to describe how e-waste is shipped into Chinese cities like Shantou in Guangdong Province where the electronics are disassembled by hand. Then, they undergo a sophisticated unsecured counterfeiting process. Again, from Sen. Levin: (more…)

Despite growing awareness and appreciation of the risks of non-compliance, only about one in four companies feel ready to meet the requirements of the Foreign Corrupt Practices Act (FCPA) and the UK Bribery Act (UKBA), according to new survey results from Kroll Business Intelligence and Investigations.

The study, which polled more than 1,200 senior executives from a broad range of industries worldwide, found that:

• Just 27 percent of survey respondents said they are well-prepared to comply with FCPA and UKBA.
• Of those companies subject to these two laws, just  43 percent have trained senior management, agents, vendors and foreign employees to be compliant with one of these laws. Even less (39 percent) have assessed the risks arising from them.
• More than one-third (37 percent) believe their due diligence provides a sufficient understanding of a potential partner’s of investment target’s compliance with these acts.

Clearly, companies need to step up their game. Not only are the risks of non-compliance quite serious (and getting more so), but fraud is on the rise. Knoll’s new research also showed that: (more…)

Losses from shoplifting, employee or supplier fraud, organized retail crime and administrative errors (also known as “shrink”) increased last year, rising to their highest levels since Checkpoint Systems, Inc. began tracking global retail theft in 2007.

Overall, Checkpoint Systems found that shrink in 2011 cost the retail industry 1.45 percent of sales –which translates into a whopping $119 billion.

Here are a few more highlights from this year’s Global Retail Theft Barometer : (more…)

New research from OpSec Security, Inc. reveals that counterfeiting has expanded beyond high cost health and beauty products, such as luxury fragrances, into everyday personal care items, such as toothpaste, shampoo and nail polish.

Obviously, these fake goods extract an enormous economic toll, pose a threat to brand reputation and present a serious risk to consumer safety, as well.

OpSec used its proprietary internet monitoring platform to identify listings of health and beauty products on business-to-business (B2B) trade boards and business-to-consumer (B2C) trading platforms within the following categories: mascara, nail polish, shampoo, razors, men’s cologne and women’s perfume. By monitoring the key Suspicious Behavior Indicators characteristic of dubious sellers, OpSec found that: (more…)

Counterfeiting operations continue to expand in reach and sophistication, and that means counterfeit products increasingly threaten your supply chain –not to mention the health and safety of millions of people worldwide, as well.

There appears to be a growing consensus that traditional methods of oversight and enforcement are simply not enough to stem the tide of fakes, and legitimate businesses are hungry for innovation to help protect their products and intellectual property.

Case in point:  Last month, the iconic acoustic guitar manufacturer C.F. Martin & Co., announced that it is partnering with Applied DNA Sciences to help secure its brand from global counterfeiting threats.

According to the Applied DNA Sciences website, the company can use DNA to protect either a product or the entire supply chain.  One method, called the SigNature DNA solution, uses DNA from plants to mark and authenticate products. Another, called BioMaterial GenoTyping, can use DNA present in natural material to assure originality and quality throughout the supply chain. Applied DNA Sciences lists applications in: (more…)