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80 SMT Magazine • June 2014 From a broader perspective, everything re- lated to the choice of testing facility is based on the risk assessment performed by your firm's engineering department and your customer. This risk assessment should also include the level of confidence in your source of supply and the proof that your supplier can provide of its supply chain traceability for the life of the com- ponent. Ultimately, the potentially deadly conse- quences of part failure, combined with the growing counterfeit epidemic, necessitate suf- ficient and effective testing from qualified test facilities. The degree of testing is generally de- termined by the type of part and the end appli- cation, but is also influenced by international standards such as AS6081. In addition to these considerations, firms must also keep in mind the level of transparency and legitimacy that their test house provides, as these could be the difference between an accurate and useful test result, and a result which causes faulty compo- nents to be installed in an end application— possibly with catastrophic effects. Clearly, in my business, I understand the need for testing and the costs associated with it that did not exist just a few years ago. One of the biggest challenges we face is educating clients on the value of additional testing costs. In order to best address this, I felt it was ap- propriate to gain some insight from Jesse Silver- man, Esq., who serves as Secure Components' in-house counsel on counterfeit mitigation-re- lated issues. I asked Silverman what his advice would be to a client looking to ensure they had performed adequate due diligence in their buy- ing activity related to the testing of electronic components procured from "other than autho- rized" sources of supply. Silverman had this to say: "If I were coun- seling a client on how to best avoid liability as- sociated with incorporating a counterfeit part I would simply pose the question: If you are hauled into court to defend your procurement and testing methodologies are you confident that you could demonstrate best practices?" The penalties spelled out in Section 818 of FY2012 National Defense Authorization Act are quite severe: • For an individual, not more than $2 mil- lion or imprisonment of not more than 10 years, or both, for a first offense and not more than $5 million or imprisonment not more than 20 years, or both for a second or subse- quent offense. • If a person other than an individual the fine shall be not more than $5 million for a first offense and not more than $15 million for a second or subsequent offense. Silverman went on to express this: "With these penalties as the backdrop, I would again ask: Are you confident that if called upon in a court of law that you can demonstrate that you exercised best procurement and testing prac- tices? In order to answer this question in the affirmative you need to demonstrate that you procured parts from the original manufacturer, an authorized dealer or a trusted supplier. Ab- sent a clear definition of "trusted supplier," you should perform due diligence on your supplier base and determine which ones you would have complete confidence in should you be dragged into court and asked to explain how, and from whom, you procured parts. Similarly, your se- kraMer on CoMponenTS DeTeRMInIng TeSTIng ReQuIReMenTS continues