As Real as It Gets, Even When Fake

On the afternoon of Sept. 8, 1989, 50 employees of Wilhelmsen Shipping Lines, including half of the company’s head office, board flight PAR 394 in Fornebu, Norway, for Hamburg, Germany. Wilhelmsen has chartered the plane so key employees can participate in the launching of the company’s newest ship. At 3:59:50, the Convair 580 turboprop departs and climbs steadily over the North Sea toward the Danish coastline.

Approximately 20 minutes into the flight, a growing vibration in the tail section of the aircraft has become noticeable to the flight crew. Within minutes, the vibration is so strong that the passengers now also realize something is unmistakably wrong. At 4:36:29, the plane’s rudder snaps forcibly to the left putting the aircraft into a violent roll. The crew is able to recover, but only momentarily. Within seconds the rudder jams back again, sending the plane into a second roll so powerful that maintenance doors leading to the tail section tear off.

There will be no second recovery. Shuddering uncontrollably, pieces of the rear rudder and elevators break away as the tail section begins to disintegrate. At 4:38:30, flight PAR 394 disappears from air traffic radar and crashes into the sea. All 55 people aboard are killed.

The accident investigation board would find that three of the four bolts that connect the rear vertical fin to the fuselage were counterfeit. As non-authentic parts, these bolts hadn’t been properly heat-treated, which reduced their required strength by 40 percent. As a result, they contributed to a “harmonic vibration” that literally shook the plane apart. 

Flight PAR 394 remains on record as the worst air disaster resulting from counterfeit parts, and thankfully, more than two decades later, there haven’t been any additional air fatalities. But likened to a multi-tentacled monster, the problem of counterfeiting is growing despite many efforts. As one procurement manager put it, “As quickly as you cut off one arm, another grows back.”

No industry escapes its grasp:    

— U.S. Military: According to a 2012 special ABC News report, China is “flooding” the U.S. market with counterfeit electronic parts, and an investigation by the Senate Armed Services Committee “found more than 1 million suspected counterfeit parts made their way into the Department of Defense’s supply chain for use by ‘critical’ military systems.”

— NASA: A 2009 report to Congress stated that counterfeit components inadvertently installed on spacecraft have contributed to millions of dollars in cost overruns and schedule delays, including a nine-month delay in the launch of the Kepler space probe.

— Pharmaceuticals: In February 2012, Roche warned of counterfeit vials of its anti-cancer drug “Avastin,” worth $6 billion a year.

— Consumer Goods: The U.S. economy reportedly loses $250 billion a year to a wide range of knockoffs, with designer bags, jewelry and wearing apparel leading the list, and another $240 billion on software and movie piracy.

A November 2011 report from the National Intellectual Property Rights Coordination Center predicts counterfeiting will be a potential $1.7 trillion issue by 2015.    

Fingers point at China as the top perpetrator because of the size and breadth of its manufacturing capacity, as well as its virtually nonexistent enforcement of intellectual property rights. “China doesn’t care,” Steve Sanghi, CEO of Microchip Technology, said in an interview with EBN, whose company’s patent-infringement lawsuit has been languishing in Chinese court for more than six years. “They know basically the U.S. government officials will cave because they’ve got a bigger agenda and need China’s support in Korea or the U.N. It’s politics, and industry suffers.” 

The problem also has reported cultural roots in that the Chinese simply think differently about intellectual property rights, considering it a tool used by foreign multinationals to deliberately prevent Chinese companies from competing.  

So how do you fight the monster? A good first line of defense is by knowing your supplier. Although this may sound overly simple, the report from the Senate Armed Services Committee found that Pentagon and U.S.-based defense contractors had sourced from “hundreds of unvetted independent distributors.” There are also new developments in technology that look promising. Invisible “QR,” or quick response, codes hold up to 100 times more data than traditional bar codes, can be printed onto virtually any solid object and are only visible under infrared light.

A list of helpful industry associations, best practices and other up-to-date information can be found on combatcounterfeits.com/resources.htm.   

Jerry Peck is a licensed customs broker and Global Trade Management expert with more than 30 years experience in regulatory compliance and GTM optimization solutions. Contact him at 469-235-5229, or at wgpeck@global-trade-ms.com.

 

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