The congressional watchdog agency set up a fake Internet company as part of a sting operation against counterfeit goods. Chinese sources represented 84 percent of the bids the fake company received. GAO said the findings conclude that China is not pursuing counterfeiters and the nature of a product does not necessarily remove it from the possibility of counterfeiting.
The latter is important because GAO was able to request, source, order, and pay for parts that do not exist.
Senate Armed Services Chairman Carl Levin, D-Mich., and ranking member John McCain, R-Ariz., said in a joint statement Monday: “The Chinese government’s refusal to shut down counterfeiting that occurs openly in their country puts our national security and the safety of our military men and women at risk.”
GAO said by the end of its operation it had purchased 16 parts from 13 Chinese vendors and all of the parts were either suspected counterfeit or false. For these products, seven had valid parts numbers but they were misrepresented since the products were either out of production or obsolete; five had authentic parts numbers but their date codes were set to after the last production date; and four were parts GAO specifically gave invalid parts numbers for but was still provided bids and parts.
“After submitting requests for bogus parts using invalid part numbers, GAO purchased four parts from four vendors, which shows their willingness to supply parts that do not technically exist,” the watchdog said in its report.
GAO did not make recommendations in the report, but said the investigation highlights the need for thorough testing of military-grade goods sourced elsewhere. GAO used nine different verification tests on the products, and 75 percent of the products received passed at least one analysis.
In November, Levin pointed up the importance of the issue, calling counterfeit military goods a “clear and present danger.” He is now urging the Treasury and Homeland Security departments to take action against China, covered in the recent National Defense Authorization Act. “Since China won’t act, we must,” he said.
A full copy of the report can be found here, while the GAO’s one-page synopsis is available here. — Geoff Whiting
