July 21, 2011

Judiciary Committee Approves Whitehouse Bill to Crack Down on Counterfeit Products Sold to the Military

Counterfeit Products Threaten Troops and Impair Military Readiness

Washington, DC – In response to increasing numbers of counterfeit products in the military supply chain, U.S. Senators Sheldon Whitehouse (D-RI) introduced the bipartisan Combating Military Counterfeits Act (S. 1228) earlier this year to crack down on criminals who traffic in these dangerous goods. Today the U.S. Senate Judiciary Committee approved this legislation by voice vote. The bill is cosponsored by U.S. Senators Patrick Leahy (D-VT), Orrin Hatch (R-UT), John McCain (R-AZ), Jon Kyl (R-AZ), Lindsey Graham (R-SC), Amy Klobuchar (D-MN), Chris Coons (D-DE), and Richard Blumenthal (D-CT).

“Our troops serving overseas have enough things to worry about each day – faulty equipment distributed by unscrupulous criminals should not be one of them,” said Senator Whitehouse. “This bill will enhance the ability of prosecutors to keep counterfeit goods out of the military supply chain, and I will work hard to see that it is passed by the full Senate.”

“The sale of counterfeit goods not only costs American jobs and harms our economy, but when counterfeits enter the military supply chain they threaten our national security and endanger our men and women in uniform,” said Senator Leahy. “This is an issue I raised with the Intellectual Property Enforcement Coordinator at a hearing last year. I applaud Senator Whitehouse’s leadership in addressing it, and am proud to support this bill.”

“Counterfeit parts pose an increasing risk to our national security, to the reliability of our weapons systems and to the safety of our men and women in uniform,” said Senator John McCain. “This legislation will ensure that prosecutors can bring the full weight of justice down on those who traffic in military counterfeits.”

“This commonsense legislation would hold criminals accountable who put our troops in danger,” said Klobuchar. “As a former prosecutor, I believe we need to crack down on traffickers who knowingly sell counterfeit military goods – it is dangerous, it is wrong, and prosecutors must have the tools they need to bring these individuals to justice.”

“With so many of our troops deployed, it is disturbing to think that inferior, counterfeit goods are making it into the hands of our men and women in uniform,” Senator Coons said. “It is a dangerous, flagrant practice and it needs to be stopped, and I was glad to join my colleagues on the Judiciary Committee this morning in moving this bill forward.”

Said Blumenthal, “Our troops deserve the best equipment to keep them safe and enable them to complete their missions as they defend our freedoms at home and abroad. The increasing incidence of quality-control problems in military contracting is both unacceptable and dangerous. This bill will curb the proliferation of counterfeit goods in the military supply chain by imposing stronger penalties for those who traffic in these goods, creating a proactive strategy to reduce the possibility that these often insufficient and defective products will end up in the hands of our service members. I applaud Senator Whitehouse and my colleagues for their leadership on this bill and will continue to join in these efforts to support our troops.”

A January 2010 study by the Commerce Department quoted a Defense Department official estimating that counterfeit aircraft parts were “leading to a 5 to 15 percent annual decrease in weapons systems reliability.” Similarly, the Government Accountability Office has reported that the Defense Department discovered in testing that it had procured body armor that was misrepresented as being “Kevlar,” and that a supplier sold the Defense Department a personal computer circuit that it falsely claimed was a $7,000 circuit that met the specifications of a missile guidance system.

The Combating Military Counterfeits Act of 2011 complements other government efforts to protect the United State military supply chain. The Senate Armed Services Committee has opened an important investigation into counterfeit electronic parts in the military supply chain. The Administration is working across agencies to protect the military supply chain from counterfeits, including through the recently commenced “Operation Chain Reaction” which targets counterfeit military products.

Under the current counterfeit trafficking statute, sentences imposed on traffickers in military counterfeits do not reflect the serious dangers that these products pose to our troops. The Combating Military Counterfeits Act would address this deficiency by creating a new criminal provision that specifically targets trafficking in military counterfeits and increasing penalties for criminals who know that the counterfeit product they sell is intended for use by the military or is identified as meeting military standards.

The bill is supported by the U.S. Chamber of Commerce, the National Association of Manufacturers, and the Semiconductor Industry Association, as well as A2B Tracking and ON Semiconductor in Rhode Island.


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