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US Military Wasted Millions on Fake Hardware, Sparking Cyber-Terrorism Fears

The U.S. Military has spent millions of dollars on counterfeit computer components over the years, according to an FBI report. This not only screws over businesses, but it also makes it easier for cyber-terrorists to hack into our systems by putting trojans and viruses in fake circuitry. An anti-counterfeit initiative by the FBI, led to 15 criminal cases and over $3.5 million worth of seized products.

The FBI op, named Cisco Raider, was a two-year-old operation that targeted illegal distributors of fake network hardware, mostly manufactured in China. With the help of their Chinese counterparts and Cisco Systems, the FBI has so far executed 39 search warrants and confiscated roughly 3,500 network components.

The FBI is still not sure whether the counterfeit goods were distributed for profit or for reasons more insidious. Though Cisco says none of the counterfeited goods contained spyware, the threat of hackers infiltrating our systems is very real.

Modern circuits have billions of parts, so it's incredibly hard to detect the tweaked bits that could help nefarious foes take over our military infrastructure. And once the cyber-terrorists take over, who're we going to call? John McClane? [New York Times]

3:00 PM on Sat May 10 2008
By Elaine Chow
8,239 views
21 comments

Comments

  • ZOMG ROFL JESUS!

  • The US has had a lot of trouble with hardware and the Chinese. Remember the massive data leak from those digital picture frames last christmas?

  • I highly doubt the Chinese govt is "directly" involved in any attempt to get around military cyber defenses. But it does make one wonder why so many devices are coming out of china with preinstalled trojans/viruses.

  • this must be china's new plan for world domination. flood the markets w/ cheap goods, flip a switch, and take over the world. ipods will make our ears bleed w/ chinese opera, robosapiens will hold us hostage w/ lasers, gps navigators will steer us into lakes.

  • $3.5 million is chunk change!... Have you guys been in suspended animation since the 60s...

  • @sfokevin: Yeah, but thats only the stuff they seized. Also the products dont have to be worth much to cause problems.

  • I bet if the US stops buying cheap crap from China and make our own stuff, we can be richer and get out of the recession, becuase we'll be creating jobs...

  • @The-Joker: The government buys from the lowest bidder. That's just the way things work. Guess who's almost always the lowest bidder? Until they change the was appropriations happens that ain't going to change.

  • Maybe the gov't needs to stay away from ebay auctions...

  • You think that's bad? The Bush admin outsourced the RFID chips in passports to Thailand. Why you ask? It's always the same for bushco - Money.

  • somebody just needs to over and destroy all those chinese factories...i vote McClain!

  • @the-Joker:

    What guarantee does the military have that buying more expensive crap made in the US are any better?

    The only results is more money spent on buying fewer pieces of crap...

  • @RainyDayInterns: And they can hold them accountable on US law.

    When it comes from other countries, their are a lot of shades of gray.

  • I picture the computers in our military to be the equivalent of Packard Bell machines circa 1995...

  • i think that we are going to call... GHOST BUSTERS!!!! dont you?

  • @RainyDayInterns:
    Speaking as an Indian, I remember a time, 15 or 20 years ago when "Made in the USA" was really a big deal here. Import restrictions were tough and our market hadn't really opened up and the few gadgets/knick-knacks that our US-settled family members would bring over every time they visited India were such a big deal. The quality of manufacturing was so good that after all these years many of these items still look (and work) good and I'm talking about simple things - like schoolbags or fridge magnets, baseball caps and electronic toys. (Case in point - a simple baby-napkin pin that was bought 25 years ago still looks and works perfectly after years of being subjected to baby drool - Made in the USA)
    In later years, the stuff they brought with them became worse (Made in Mexico) and still crappier (Made in China) and nowadays we specifically ask our relatives to not buy anything when they come here because we get the same Chinese-made crap in India as well. So what's America lost over the billions it must've saved in manufacturing costs? Tens of thousands of jobs, pride in the "Made in the USA" label, irreplaceable manufacturing knowledge, lack of innovation...
    I wish the trend would reverse and good stuff starts getting made in the USA again. The world could sure use the quality.

  • @Barry99705: No, the US gov does not always for the the lowest bidder. Look at the companies that got contracts in Iraq. Also, it may be cheaper right away to outsource to the lowest bidder, but the value of creating good paying jobs in the US is generally cheaper in the long run (less welfare, more tax revenue, etc).

  • @Trinetra: And also, this plays a huge US government power role. Yes, the US may be in an economic recession or slowdown but what would happen to other countries such as Saudi Arabia if we stopped buying Oil from them and instead used a different energy source because they rely on much of the wealth to come from the US. What would happen to China if we stopped buying the lead filled toys or just plain isolated more of our economy.

    Also there is the constant recession talk while in our own backyard the government could just create jobs by making factories to manufacture decent hardware and safe toys.

  • Whose idea was it to buy the important stuff from China anyway? Theyre companies, which btw are almost certainly directly controlled by their government, definetly have some sort of agenda. If our government wants quality longlasting computer components why not invest in, um i dont know, the US? Since our own companies have less of an incentive to sell us crappy, virus/trojan filled mcdonalds bag stuffing computer components, it makes a hell of a lot more sense to just pony up the extra money.

  • @Trinetra: You couldn't have put that any better. I work in a service industry that caters to manufacturing and we are dreadfully slow because all the manufacturing jobs are leaving the country and that means there are fewer customers for us. Almost all the American made goods that we used to sell are foreign and you have to carry them or you will go completely out of business. When people ask why, you just have to say the American goods aren't available (and if they are they are twice as expensive)and they shrug their shoulders and buy it. It's too bad that we have let ourselves get into this sad state of affairs and it's going to take a huge crash here in America before anything changes.

  • That'll teach them to buy motherboards from PC Chips.

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