Recently, a customer inquired about whether or not an independent distributor can be considered over an authorized distributor for purchasing electronic components.

The EMPF responded to the customer's inquiry by pointing out several things to keep in mind when considering independent distributors over authorized distributors. Although it may be affordable to purchase through independent distributors, you run the risk of potentially buying defective or counterfeit components. First, there are several important stipulations which are guaranteed to the customer through an authorized distributor. Second, correcting for counterfeit components downstream in a process is time consuming and costly. Third, there are several industry guidelines to detect counterfeit components.

First, original manufacturers of electronic components have franchise agreements with their authorized distributors.¹ In these agreements, there are several important stipulations which ensure the quality and traceability of its products such as:

• Original manufacturer warranty
• Proper handling, storage, and shipping procedures
• Failure analysis and corrective action support
• Certificates of conformance and acquisition traceability

Independent distributors are not required to have these agreements with the original manufacturer so it is more difficult to trace parts and ensure product reliability. Although it is legal to purchase these goods on the"gray market," you run the risk of purchasing counterfeit components. In 2005, the Department of Defense (DoD) and military equipment manufacturers purchased $1.4 billion in semiconductors with $300 million through brokers. According to Senator Carl Levin, ranking member of the Senate Armed Services Committee, counterfeiting is estimated to account for five to seven percent of all worldwide trade. With this estimate, counterfeit parts purchased by the DoD in semiconductors would roughly cost between $70 million to $100 million.²

Second, the cost for correcting a counterfeit component can be costly and time consuming. Once the component has been identified as counterfeit, the production line would need to be stopped immediately. All board assemblies with the counterfeit component would need to be replaced and tested afterwards. If any of the products made it to the end user, the customer would have to deal with customer support, field returns, and product recalls. Most importantly, the company's reputation as a reliable manufacturer could be jeopardized. If your components were purchased through an authorized distributor, you can ensure quality and traceability by contacting the original manufacturer directly. In one situation, a military contractor purchased IC chips from an unauthorized reseller with numerous issues such as broken wire bonds and missing silicon dies. The manufacturer later claimed that these chips were scrapped as defective parts which somehow made it to the gray market.

In another situation, a military electronics firm bought a hundred memory IC chips from two parts brokers. Around that time, the Government-Industry Data Exchange Program (GIDEP) reported that counterfeit memory chips existed which were marked with lot code TAH9449 instead of THA9449 (for Thailand).³ Using a simple chemical re-surfacing technique, markings on the component can be tested to see if anything has been altered (Figure 2-1). Failure analysis can be both costly and time consuming when it is not detected at incoming inspection but further downstream in the manufacturing process.

Third, there are several industry guidelines to follow if you decide to go with an independent distributor. The JEDEC Solid State Technology Association has general requirements for distributors of commercial and military semiconductor devices in its JESD31 standard. These requirements include a quality system, document control, records, and inventory control. The Independent Distributors of Electronics Association has developed a set of techniques for counterfeit detection in their IDEA-STD-1010A standard. Some of these techniques include evaluation for component body re-marking/re-surfacing and contamination or oxidation of leads. Simple non-destructive testing can be performed, such as X-ray inspection to examine internal circuitry, as well as X-ray fluorescence to confirm the surface finish of leads.

You can always first check with the independent distributor to see if they can provide documentation regarding traceability and authenticity. If you are in doubt about an independent distributor, you can use an independent analytical lab to perform counterfeit analysis on a small sample batch. This can be done prior to purchase and takes very little time and cost. A little effort to eliminate counterfeit parts up-front can save you time and money in the long run.

Articles on counterfeit analysis can be found in previous issues of Empfasis (December 2003 and November 2007) available online at http://www.empf.org/empfasis/. For assistance with counterfeit analysis or other failure analysis of components and board assemblies, contact the EMPF at 610.362.1320, email to helpline@empf.org, or use the website form at http://www.aciusa.org/forms/helpline_form.php

References

• Livingston, Henry. "Avoiding Counterfeit Electronic Components." IEEE Transactions on Components and Packaging Technologies 30.1 (2007): 187-89.
• Stradley, J., and D. Karraker. "The Electronic Part Supply Chain and Risks of Counterfeit Parts in Defense Applications." IEEE Transactions on Components and Packaging Technologies 29.3 (2006): 703-05.
• 3. Pecht, Michael, and Sanjay Tiku. "Bogus! Electronic Manufacturing and Consumers Confront a Rising Tide of Counterfeit Electronics." IEEE Spectrum Online: Technology, Engineering, and Science News. May 2006. http://spectrum.ieee.org/computing/hardware/bogus