| 00:00:29 |
Levin, Carl - U.S. Senator, [D] Michigan
SERVICES COMMITTEE'S ONGOING INVESTIGATION INTO COUNTERFEIT ELECTRONIC PARTS IN THE DEPARTMENT OF DEFENSE'S D.O.D. SUPPLY CHAIN. WE WILL PROBABLY HOLD...
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| 00:26:32 |
McCain, John S. III - U.S. Senator, [R] Arizona
RISK TO NATIONAL SECURITY. THESE COUNTERFEIT ELECTRONIC PARTS IN OUR SUPPLY CHAIN RESULTS IN REDUCED RELIABILITY, AVAILABILITY, AND FRANKLY, OUR ABILITY...
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| 00:30:35 |
Levin, Carl - U.S. Senator, [D] Michigan
McCAIN. LET US START WITH MR. SHARP. ORDINARILY, WE WOULD PROBABLY CALL ON THE GAO WITNESS FIRST, BUT I THINK WE'RE GOING TO START WITH THE PROBLEM...
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| 00:31:00 |
Sharpe, Thomas - Vice President
CHAIRMAN, SENATOR McCAIN, AND MEMBERS OF THE COMMITTEE. I WANT TO THANK YOU FOR ALLOWING ME TO COME IN AND PROVIDE THIS TESTIMONY. THE ISSUES WITH...
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| 00:36:40 |
Levin, Carl - U.S. Senator, [D] Michigan
STATEMENT WILL BE MADE PART OF THE RECORD. THAT WILL BE TRUE OF ALL THE STATEMENTS OF OUR WITNESSES. IN SOME CASES, THEY ARE REDUCING THE LENGTH OF THAT...
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| 00:36:53 |
Hillman, Richard - Director
HILLMAN. >> CHAIRMAN LEVIN, AND MEMBERS OF THE COMMITTEE. THANK YOU FOR THE TOUNT DISCUSS THE PRELIMINARY OBSERVATIONS OF OUR ONGOING INVESTIGATION...
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| 00:43:52 |
Toohey, Brian - President
TO TESTIFY TODAY TO AID IN YOUR INVESTIGATION IN THE COUNTERFEIT ELECTRONIC PARTS AND ABOUT THE DANGERS TO U.S. SECURITY AND PUBLIC SAFETY. THE ISSUE...
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| 00:50:02 |
Levin, Carl - U.S. Senator, [D] Michigan
MUCH. LET'S TRY A SEVEN-MINUTE FIRST ROUND. IF BENEED A SECOND ROUND WE'LL HAVE ONE. IF WE NEED A SECOND ROUND WE'LL HAVE ONE. LET ME START, FIRST,...
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| 00:51:13 |
Hillman, Richard - Director
THAT'S CORRECT. WE DIDN'T TARGET ANY SPECIFIC REGION. LOOKED AT SPECIFICALLY INDIVIDUAL PART NUMBERS REQUESTED BY IN COMMITTEE. WE ADDED THE NUMBERS...
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| 00:53:55 |
Sharpe, Thomas - Vice President
FOR? DID YOU KNOW WHO YOU WERE TESTING THEM FOR? >> ON BEHALF OF GA. >> BUT NOT FOR THIS COMMITTEE? >> NO, SIR. >> AND YOU SELL PARTS, TOO? >> BIGGEST...
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| 00:57:34 |
McCain, John S. III - U.S. Senator, [R] Arizona
I THANK THE WITNESSES. >> HOW SERIOUS DO YOU THINK THIS PROBLEM IS? >> THE RESULTS OF OUR WORK TO DATE IS BASED OFF OF A
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| 00:57:47 |
Hillman, Richard - Director
NONGENERALIZABLE SAMPLE OF PARTS THAT WE WERE REQUESTED TO PURCHASE AND THEREFORE, WERE UNABLE TO DISCUSS THE PREVALENCE OF THIS ACTIVITY. >> IS IT...
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| 00:58:31 |
Toohey, Brian - President
ANT ABOUT IT? >> I OUTLINED A NUMBER OF STEFS THAT I THINK WE OUGHT TO CONTINUE AND EXPAND. CERTAINLY, WORKING TO STRENGTHEN THE AUTHENTICATION PROCEDURES...
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| 00:59:55 |
Sharpe, Thomas - Vice President
COMPONENT MANUFACTURERS TO GET INFORMATION ON THE DYE MARKINGS. INFORMATION ON THE FRONT MARKINGS ON OBSOLETE PARTS THAT WE DON'T HAVE DATA ON. >>...
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| 01:05:12 |
Udall, Mark - U.S. Senator, [D] Colorado
I'VE HEARD IS THAT THIS IS A SERIOUS AND GROWING PROBLEM. I'D LIKE TO BUILD ON THE COMMENTS AND QUESTIONS THAT CHAIRMAN AND THE SENATOR McCAIN HAVE ASKED....
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| 01:07:13 |
Sharpe, Thomas - Vice President
PROGRAM TO HAVE THEM CERTIFIED BEFORE I WAS TO SEND THEM INTO DODD? >> I THINK THAT'S WHAT I'M GETTING AT. TAKING SUPPLIERS AT THEth THEIR WORD FOR THE...
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| 01:09:19 |
Toohey, Brian - President
SOLUTION AND PART OF THE SOLUTION IS CONTINUES THE WORK WE'RE DODD WITH DoD FOR THE AUTHENTICATION PROCESS AND ASSURING THAT PROCESS WORKS SO MANUFACTURES...
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| 01:12:10 |
Hillman, Richard - Director
OR IS THIS EVIDENCE OF COMPLICITY? >> WE'LL REPORT OUR FINAL RESULTS LATER THIS YEAR. >> DID YOUR INVESTIGATION DETERMINE THAT ANY OF OUR SERVICE...
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| 01:13:55 |
Brown, Scott - U.S. Senator, [R] Massachusetts
IN YOUR INITIAL STATEMENT THAT WE'RE OBVIOUSLY PAYING FOR PRODUCT AND THEN WE, HAVE DETERMINED THAT THOSE PRODUCTS ARE BEING SUPPLIED WITH DEFECTIVE...
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| 01:14:22 |
Levin, Carl - U.S. Senator, [D] Michigan
OUR SECOND PANEL, BUT THE EXAMPLE I GAVE, YEAH. WE PAID FOR THE REPAIR BECAUSE IT WAS A COST-PLUS CONTRACT AND UNLESS YOU CAN PROVE INTENTION, THAT...
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| 01:16:46 |
Sharpe, Thomas - Vice President
WE DON'T BUY PRODUCT THERE BUT THE TRIP BEGAN AS A BUSINESS TRIP TO VISIT A U.S.-BASED CUSTOMER IN HONG KONG THAT WAS THEN TO TURN INTO A VACATION...
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| 01:18:07 |
Toohey, Brian - President
ENSURING WE'RE USING ALL TOOLS AVAILABLE AND TO LEVERAGE OUR LAW ENFORCEMENT COMMUNITY AS WELL TO CONTINUE TO AGGRESSIVELY PROSECUTE THESE VIOLATORS....
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| 01:20:33 |
Persons, Timothy - Chief Scientist
WAS OUTSIDE THE SCOPE OF OUR PARTICULAR INVESTIGATION WHICH IS STILL GOING ON. IN TERMS OF DEALING WITH THOSE THINGS, GAO HAS DONE REPORTS ON E-WASTE...
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| 01:21:41 |
Manchin, Joe III - U.S. Senator, [D] West Virginia
ANY CHINESE COMPANY OR THE GOVERNMENT AGENCY THAT MAKES ANY PRODUCT THAT THEY HAVE RESEARCHED, DESIGNED IT, THEY'VE DONE THE RESEARCH AND BROUGHT IT...
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| 01:22:16 |
Toohey, Brian - President
FOUNDRY, A VERY -- >> I'M SAYING DO YOU KNOW OF ANYTHING THAT THEY INVENTED? >> SENATOR, THERE ARE SOME SPECIFIC APPLICATIONS, SEMICONDUCTORS THAT HAVE...
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| 01:23:59 |
Hillman, Richard - Director
TO FIND AND OBSOLETE PARTS THAT ARE STILL BEING UTILIZED IN MAJOR WEAPONS SYSTEMS. THE INTERNET PURCHASING PLATFORMS DEMONSTRATE THAT CONTRACTORS...
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| 01:25:30 |
Sharpe, Thomas - Vice President
THAT HAVE BEEN INSPECTED PROPERLY. >> YES, THERE ARE OTHER COMPANIES LIKE THE UNITED STATES LIKE OURS. >> SO WE DON'T HAVE TO GO TO CHINA TO THESE COUNTERFEITERS...
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| 01:26:25 |
Persons, Timothy - Chief Scientist
MILL-PRF-35 TERMS OF THE, TESTS THAT WE RAN IN OUR UNDERCOVER OPERATION THERE ARE SPECS BEING WRITTEN. >> WHO WRITES THE SPECS? I'M SURE WE HAVE...
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| 01:27:36 |
Levin, Carl - U.S. Senator, [D] Michigan
IN ORDERS AND THE CHEAPEST PARTS THAT SHOWED UP FROM -- THEY'RE ALL FROM CHINA, TURNED OUT TO BE COUNTERFEIT. ALL OF THEM AND SOME OF THE NUMBERS...
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| 01:29:45 |
Ayotte, Kelly A. - U.S. Senator, [R] New Hampshire
CHINA. CAN YOU EXPLAIN THAT? >> THERE IS AN AWFUL LOT OF PRODUCT
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| 01:29:53 |
Sharpe, Thomas - Vice President
IN CHINA THAT'S CERTAINLY NOT COUNTERFEIT. GOING TO CHINA TO BUY FROM NONAUTHORIZED SOURCES A SURE WAY AS FAR AS WE CAN SEE, TO GET OURSELF INTO TROUBLE....
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| 01:32:39 |
Toohey, Brian - President
SENATOR, FROM OUR PERSPECTIVE EVERYTHING OUGHT TO BE DONE THAT CAN BE DONE TO ENSURE LEGITIMATE PRODUCT IS GOING INTO THESE PRODUCTS AND WHILE I'M NOT...
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| 01:36:29 |
Hillman, Richard - Director
ASSOCIATED "COUNTERFEITING OF AN HARVESTING OF OLD PARTS AND PUT INTO A FASHION THAT APPEAR TO BEING NEW. THE VENDORS THAT WE HAVE SUPPLIED THESE PARTS...
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| 01:37:28 |
Levin, Carl - U.S. Senator, [D] Michigan
WE'LL ALL BE ABLE TO SUPPORT BECAUSE ANYWAY, WE'LL HAVE THAT OPPORTUNITY THAT YOU MADE REFERENCE SO, SO WE THANK YOU FOR THAT. >> I APPRECIATE IT. >>...
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| 01:37:48 |
Collins, Susan M. - U.S. Senator, [R] Maine
SUCH IN-DEPTH INVESTIGATION INTO SUCH AN IMPORTANT PROBLEM. I WOULD POINT OUT THAT THIS PROBLEM IS NOT A NEW ONE. I RECALL BACK IN 2004 LOOKING INTO...
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| 01:39:53 |
Toohey, Brian - President
NEW ITEMS, TO GO INTO THE DEFENSE DEPARTMENT SUPPLY CHAIN IN A VERY ASSURED WAY. IN MY WAYS, WHAT WE'RE TALKING ABOUT HERE ARE PARTS THAT ARE NO ...
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| 01:45:17 |
Hillman, Richard - Director
PROGRAM, ALTHOUGH IT IS VERY CLEAR THAT THE DEPARTMENT OF DEFENSE CONTINUES TO RELY ON A PARTS THAT HAVE OLD MANUFACTURED DATES, SOMETHING SIMILAR...
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| 01:46:50 |
Sharpe, Thomas - Vice President
SO I REALLY WOULDN'T HAVE MUCH TO SAY THERE. WITH REGARD TO THE REDACTION, I COMPLETELY AGREE WITH BEING ABLE TO PROVIDE THE COMPONENT MANUFACTURE WITH...
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| 01:48:26 |
Chambliss, Clarence "Saxby" - U.S. Senator, [R] Georgia
I'LL DIRECT THIS FIRST QUESTION TO YOU. BUT IF ANYONE ELSE HAS A COMMENT, I WOULD APPRECIATE IT. WHAT END CASE DO WE HAVE THAT THE CHINESE GOVERNMENT...
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| 01:48:52 |
Hillman, Richard - Director
WERE WILLING TO SUPPLY THOSE PARTS. THE EXTENT TO WHICH THE CHINESE GOVERNMENT ITSELF IS COMPLICIT IN THESE ACTIVITIES HAS NOT BEEN PART OF OUR INVESTIGATION,...
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| 01:49:45 |
Sharpe, Thomas - Vice President
WHO ACCOMPANIED ME, I AM WORKING OFF OF WHAT HE SAID AS FAR AS THE PERCENTAGES GO. I'VE HEARD ALSO THIS INFORMATION FLOATING AROUND FROM OTHER FOLKS...
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| 01:50:30 |
Hillman, Richard - Director
YES. COUNTERFEIT PARTS AND OTHER ITEMS THAT ARE PRODUCED ON A COUNT AREERFEIT BASIS IS SOMETHING THAT AFFECTS ALL INDUSTRIES. >> THAT WOULD BE THE SAME...
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| 01:51:26 |
Toohey, Brian - President
AFFECTING MANY INDUSTRIES AND IT'S A GROWING ONE, SENATOR. >> IN JANUARY 2008 TIME FRAME, A COUNTERFEIT CHIP WAS FOUND IN AN F-15 FLIGHT CONTROLLER...
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| 01:56:05 |
Levin, Carl - U.S. Senator, [D] Michigan
SOME OF THE NUMBERS ON THESE PARTS WERE REAL NUMBERS THAT YOU WERE CHECKING OUT, SOME WERE PHONY NUMBERS AND YOU GOT RESPONSES FOR BOTH. BUT ON THE REAL...
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| 01:56:47 |
Persons, Timothy - Chief Scientist
FORCE'S KC-1030 AIRCRAFT AND THE NAVY'S SUPER FIGHTER PLANE, THE MARINE CORPS' OSPREY AIRCRAFT AND THE NAVY'S SSN 668 LOS ANGELES CLASS NUCLEAR POWERED...
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| 01:58:19 |
Hillman, Richard - Director
WITH INDIVIDUALS IN CERTAIN CITIES WITHIN CHINA AT THE TIME WE RECEIVED PAYMENT INFORMATION, THE ADDRESSES MAY HAVE CHANGED CONSIDERABLY, POINTING...
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| 01:59:06 |
Sharpe, Thomas - Vice President
PROCESSES THAT WERE IDENTIFIED BY SMT CORPORATION THAT WERE NEW COUNTERFEIT PROCESSES THAT WE HAD NOT SEEN BEFORE. >> PROCESSES THAT TRY TO DETERMINE...
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| 02:05:32 |
Toohey, Brian - President
HAVE BEEN WORKING WITH D.O.D. AND WE WANT TO STRENGTHEN THAT. WE WOULD BE ENTHUSIASTIC TO WORK WITH THE CHT AND BORDER PROTECTION TO BE CERTAIN TO...
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| 02:09:08 |
O'Reilly, Patrick J. - Director
TO TESTIFY BEFORE YOU TODAY ON THE SERIOUS PROBLEM OF COUNTERFEIT ELECTRONIC PARTS INFILTRATING OUR CRITICAL DEFENSE SYSTEMS AND THE STEPS THAT...
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| 02:15:52 |
Levin, Carl - U.S. Senator, [D] Michigan
THE COMMITTEE'S QUESTIONS. >> THANK YOU VERY MUCH, GENERAL. FIRST LET ME THANK THE MDA FOR PROVIDING THE COMMITTEE WITH ASSISTANCE IN THIS INVESTIGATION....
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| 02:17:15 |
O'Reilly, Patrick J. - Director
SIR. 61% OF THE ONES WE HAVE LOOKED AT WE COULD NOT CERTIFY, I DO NOT ACCEPT A MODERATE RISK AND SO 61% WERE DETERMINED TO HAVE EITHER MODERATE OR...
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| 02:23:43 |
McCain, John S. III - U.S. Senator, [R] Arizona
CHAIRMAN AND THANK YOU, GENERAL, FOR YOUR IMPORTANT TESTIMONY. I'D
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| 02:23:48 |
O'Reilly, Patrick J. - Director
LIKE TO START OUT BY ASKING YOU WHAT I ASKED THE OTHER PANEL. HOW SERIOUS A PROBLEM DO YOU THINK THIS IS? >> EXTREMELY SERIOUS, SIR. >> WHEN THE LARGEST...
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| 02:30:33 |
Levin, Carl - U.S. Senator, [D] Michigan
THAT IS THE CASE. >> THANK YOU VERY MUCH, SENATOR McCAIN. AND IF YOU WOULD GET TO US, GENERAL, IMMEDIATELY BECAUSE WE'RE GOING TO BE DRAFTING LANGUAGE,...
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| 02:31:17 |
O'Reilly, Patrick J. - Director
GIVE US THAT CLAUSE AGAIN. >> OUR NEW POLICY PUTS INTO ALL NEW CONTRACTS A CLAUSE THAT SAYS THE CONTRACTOR HAS TO USE -- HE IS RESPONSIBLE FOR USING ORIGINAL...
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| 02:32:27 |
Hagan, Kay R - U.S. Senator, [D] North Carolina
YOUR WORK AS DIRECTOR OF THE MISSILE DEFENSE AGENCY. >> HEARING THIS TESTIMONY AND THINKING ABOUT THE TELEMETRY AND ALL OF THE VERY FINE TUNED ...
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| 02:33:20 |
O'Reilly, Patrick J. - Director
ISSUES. >> SENATOR, WE ACTUALLY DO. WE WORK VERY CLOSELY WITH THE DEFENSE CONTRACT MANAGEMENT COMMAND. THEY HAVE ON-SITE PERSONNEL. I HAVE 50 ON-SIGHT...
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| 02:34:29 |
Hagan, Kay R - U.S. Senator, [D] North Carolina
WE'VE ALREADY PUT IN PLACE THAT'S NECESSARY. >> HOW COMFORTABLE ARE YOU THAT THE PRIME CONTRACTORS AND THEIR SUBCONTRACTORS ARE ALSO HAVING THE DUE...
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| 02:38:44 |
Levin, Carl - U.S. Senator, [D] Michigan
POLICIES. >> THANK YOU, MR. CHAIRMAN. >> THANK YOU VERY MUCH, SENATOR HAGAN. THANK YOU, GENERAL. WE REALLY WOULD LOOK FORWARD TO YOU BEING ABLE TO...
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| 03:07:18 |
Levin, Carl - U.S. Senator, [D] Michigan
EXCALIBUR. AND RAYTHEON MISSILE SYSTEMS AND UNITED LAUNCH. >> YOU KNOW WHAT SYSTEM FOR UNITED LAUNCH? >> I DO NOT, SIR. >> HOW ABOUT THE RAYTHEON...
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| 03:07:58 |
Kamath, Vivek - Vice President
YES. >> OKAY, NOW. >> OKAY. YOU KNOW IF RAYTHEON WAS NOTIFIED OF THAT SUSPECT PART THAT YOU JUST TOLD US ABOUT BEFORE TODAY? >> NOT YET AT THIS POINT....
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| 03:12:27 |
Levin, Carl - U.S. Senator, [D] Michigan
IN YOUR OWN COMPANY AND ITS COMPONENTS WILL KNOW WHEN THERE IS A SUSPECT COUNTERFEIT PART? >> THAT'S CORRECT. >> THAT WAS NOT CASE AT THAT TIME. >>...
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| 03:12:40 |
DeNino, Ralph - Vice President
HAD BEEN ISSUED. >> BUT NOT TO YOUR OWN -- >> TO OUR CUSTOMER. >> BUT INSIDE OF YOUR COMPANY YOU DID NOT NOTIFY THE PRIME WHICH WAS A SUBSIDIARY...
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| 03:15:52 |
Levin, Carl - U.S. Senator, [D] Michigan
YOU NOTED WE WERE NOTIFIED IN JANUARY OF 2010. THAT NOTE OF ESCAPE INITIATES THE ENGINEERING INVESTIGATION
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| 03:16:02 |
Dabundo, Charles - Vice President
BETWEEN BOEING AND BAE, THE BCA ENGINEERING GROUP. BCA IN FEBRUARY INITIATED A SUSPECT DISCREPANCY REPORT THAT INDICATED THAT THERE WERE NO SAFETY CONCERNS...
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| 03:21:50 |
Levin, Carl - U.S. Senator, [D] Michigan
BE REPAIRED ON AN ATTRITION BASIS. >> THE CUSTOMER WAS NOT NOTIFIED FOR THE YEAR. LET ME GO THROUGH THECO-NOL JOY. >> THE CUSTOMER WAS NOT NOTE ...
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NOTE: The transcript for this program was compiled from uncorrected Closed Captioning.