Man Pleads Guilty To Selling Fake Chips To US Navy 327
itwbennett writes "Neil Felahy of Newport Coast, California, has pleaded guilty to conspiracy and counterfeit-goods trafficking for his role in a chip-counterfeiting scam. Felahy, along with his wife and her brother, operated several microchip brokerage companies under a variety of names, including MVP Micro, Red Hat Distributors, Force-One Electronics and Pentagon Components. 'They would buy counterfeit chips from China or else take legitimate chips, sand off the brand markings and melt the plastic casings with acid to make them appear to be of higher quality or a different brand,' the US Department of Justice said in a press release. The chips were then sold to Naval Sea Systems Command, the Washington, DC group responsible for maintaining the US Navy's ships and systems, as well as to an unnamed vacuum-cleaner manufacturer in the Midwest."
Treason (Score:2, Insightful)
You know the penalty.
Re:Treason (Score:5, Insightful)
http://caselaw.lp.findlaw.com/data/constitution/article03/ [findlaw.com]
"Treason against the United States, shall consist only in levying War against them, or in adhering to their Enemies, giving them Aid and Comfort"
Ripping them off isn't treason.
Re:Ron Paul!!! (Score:5, Insightful)
Because it was the free market and private enterprise that was doing the scamming?
And if they are willing to pull this on the gov't then it really doesn't bode well for the rest of us peons.
Re:Unconstitutional (Score:5, Insightful)
In other words the right to regulate chip counterfeiting belongs to your local State government, until you expand the Constitution with an amendment
Wrong. This is actually a proper use of the Interstate Commerce Clause. Now arresting some poor bastard for growing pot for his own personal use on the other hand.......
Re:Ron Paul!!! (Score:4, Insightful)
Isn't there some confusion here? This is the free market at work; if it wasn't, the Navy would have their own fabs and employ wafer process techs as well as sailors and airplane mechanics. This is outside the brief of the government, especially the Navy, hence the government buying the fake chips from a private contractor. They didn't do enough due diligence and got burned -- isn't that what's supposed to happen when there's an information imbalance in a market?
Re:uuuh (Score:4, Insightful)
I suggest you start a small business owned by a woman who is a minority.
Why is it (properly, IMHO) called racism and/or sexism if someone gives favoritism to a white male but doing the inverse is just fine and dandy?
Re:Treason (Score:4, Insightful)
What "enemy"?
Re:Ron Paul!!! (Score:2, Insightful)
What happened is that they went with the cheapest (lowest bid) contractor. The other guys who bid on the contract probably had legit chips to sell and couldn't compete with the cheaters.
This is why the government's practice of having to accept the lowest bid is just fucking dumb. They always get ripped off.
Look at any of your local construction projects. The lowest bidder got that job. Now the job is over budget and behind schedule.
They rarely go with the best, most qualified bidder.
Re:Can someone please explain the crossover here? (Score:3, Insightful)
That's a typo. I'm sure they've meant "UNMANNED vacuum-cleaner" like the Roomba.
Re:uuuh (Score:4, Insightful)
Why is it (properly, IMHO) called racism and/or sexism if someone gives favoritism to a white male but doing the inverse is just fine and dandy?
2 generations ago: negros were riding on the back of the bus (1949)
3 generations ago: women hadn't yet been given the right to vote (1919)
The short version is: because we say so.
The full version might have something to do with the long and storied
history of racism, sexism, and exploitation throughout human history.
Re:Treason (Score:3, Insightful)
And for the other, who is the "enemy"? It doesn't give aid to the non-existent "enemy", it simply gives you more money. They should be prosecuted for fraud, not treason.
Re:Ron Paul!!! (Score:5, Insightful)
The government is not at fault. The owner of those businesses is. The government looked for a seller within our free market, and that seller conspired to fool the government.
If anything, this says more negative about the free market, and the willingness of people to do illegal things out of selfish greed.
The government is the people. It is for the people, by the people. If the government is so "fucked up" as you say it is, than perhaps its just a reflection of our citizens.
We need to be BETTER PEOPLE for ourselves, and our fellow Americans.
Re:Treason (Score:5, Insightful)
First of all, the charge of treason is obviously inappropriate. Fraud it is.
But to your other point, using a low-spec chip can certainly lead to lower reliability. What if the ersatz chip has less forgiving temperature than the real thing? What if the software running on it assumes it can respond within 50us to an external input, but because the ersatz chip is running at a lower clock speed, the response time is 100us? That could be the difference between your anti-ship-killer-missile cannon hitting the target and you surviving, or it missing and you dying.
This is serious.
Re:Ron Paul!!! (Score:4, Insightful)
I don't think this is an issue of Due Diligence - blame the goverment blah blah blah - it's an issue of THEY LIED. They stated the chips were one thing / one grade and turned out they were another grade entirely.
It's reasonable to expect regular consumers in the marketplace to perform due diligence but when a person claims the product is the product and it appears that way then the person has performed due deligence. Requiring the person to inspect fab plants and everything else for every manufacturer is not due diligence - it's a hassle.
Let's get out of this blame the government mantra - the politico talking heads are having enough fun as it is. This is a criminal issue for which the company should be nailed pretty harshly. The goverment should get it's retribution through whatever means are most expedient.
Re:uuuh (Score:3, Insightful)
The full version might have something to do with the long and storied
history of racism, sexism, and exploitation throughout human history.
I see, so this is just history repeating itself.
For a moment there I thought two wrongs don't make a right.
Re:uuuh (Score:4, Insightful)
What were white men doing two or three generations ago?
While some of them were probably benefiting greatly from institutionalized sexism and racism, others were part of the poor, downtrodden masses.
Even today, there are places that are very white and very poor, where there is little opportunity, and crime and poverty runs rampant.
So why do we assume all white men don't need any additional help?
Is it because of the color of their skin and their gender?
Re:Treason (Score:3, Insightful)
Note that I consider accidents to be those things that you could not control, ie someone jumps in front of your car. Not your fault. If you were drunk and hit someone, however, then you made the intentional choice to get drunk. The consequences of getting drunk involved killing someone. You might not have intended to kill them, but you intended to get yourself into a state where you couldn't control your actions and thereby pose a threat.
Sell bad hardware to the Navy, well you intended to commit fraud. The results of that fraud might not be intentional, ie failure of mission critical systems and death, but you started the chain reaction. I'm not saying it is treason either, but any damage as a result of his fraud is still his fault, intended or not.
Re:we still make vacumm cleaners? (Score:3, Insightful)
Re:Treason (Score:3, Insightful)
Knowing selling the Navy computer components you KNOW would fail, to me, would fall into "giving aid to the enemy"
Unless he acquired chips specifically designed to fail in combat, no, it's just a ripoff.
We could argue intention/motivation, but a crime is a crime, regardless what you meant.
The consequences are measured by motivation. Trust me, you do not want the definition of treason to get fuzzy, unless you want to fear what you post on public forums.
Re:Treason (Score:3, Insightful)
No, actually, its not. Crimes general have a required mental state, and "what you meant" specifically is very often an essential component of the crime. What you meant (and when and why you came to mean it) can make the difference between Murder, Voluntary Manslaughter, Involuntary Manslaughter, and a non-criminal accident in which someone happens to have died.
"a crime is a crime, regardless what you meant" would suggest that if, hypothetically, a group of passengers attempted to seize control of a commercial aircraft from hijackers attempting to use the plane as a weapon in a mass casualty attack aimed at a populated area, but caused the plane to crash in the process, and everyone on the plane was killed except for one of the passengers who tried to seize control of the plane back from the hijackers, that passenger would be as guilty of murdering everyone on the plane as he would have been if, instead, he had hijacked the plane and deliberately crashed it for the purpose of killing everyone on the plane. Intent, indeed, matters, both legally and morally.
Re:Amusement du jour: (Score:5, Insightful)
Yep I suppose we're gonna get a whole bunch of these 'Counterfeit Goods' stories hitting the media in the next year or so to make people think we absolutely positively must pass the ACTA treaty the RIAA/MPAA have been working on in secret.
Re:Military spec vs commercial (Score:3, Insightful)
This is the strangest definition of fraud. Smacks of a mail order degree in popular economics with hand typed training materials.
What a company is selling is a chip that conforms to its spec. sheet. If the military version has a different spec. sheet, they can charge any price they like for putting into effect the QC process which allows them to stand behind those claims.
It's not even in the military's interest to squeeze these vendors on price. That would only result in niche products the military depends upon being discontinued faster than ever. There's real cost here. You've got to keep some old guy around who remembers details about products you rarely sell, in case the military comes calling. If a company fails to maintain this courtesy, it won't long find itself on the preferred vendor list for new designs.
The way out of this price trap is for the military to toss their aircraft carriers onto the landfill at the same rate consumers dispose of their cell phones. Then they can quote for volume on parts rated for a short rough-and-tumble service life and only pay twice as much as the common man.
Re:Treason (Score:3, Insightful)
Industrial setting. Alright, if you say so, I won't argue that comparison.
But, I have yet to see the industrial setting that I experienced in the winter of 1978 in the North Atlantic, the North Sea, and various bodies of water in and around Ireland, Scotland, Norway, etc. Everything was lashed down, to prevent it from becoming a missile hazard. Even a navsup pub can be hazardous, when the ship is tossing, bucking, and rolling violently in stormy seas. We lashed ourselves into our bunks, because being thrown from the top bunk could be fatal. In this kind of environment, dropping the load is likely to mean being capsized, and losing all hands aboard.
Not everything aboard a destroyer is a combat system, true. But, there is nothing aboard ship that can't cost your life, or save your life, when the shit hits the fan.
Maybe you accepted a career of tedium while you were in. Personally, I volunteered for anything and everything, and I intentionally chose commands that were most likely to see action. You'll probably admit there is considerable difference between tender duty, and duty aboard a leading desron's flagship.
USS Richard E. Byrd DDG-23, DesRon 2
I'm less proud of the USS Koelsch FF-1049. That was the tedium you seem to have in mind. The most exciting thing on that tub was when they asked the landing party to go ashore to verify some satellite intelligence. Dropping the load was almost routine, so it was never sent into the North Atlantic, and certainly not during the winter months.
Re:Treason (Score:3, Insightful)
huh?
I do embedded real time programming and guess what? lower performance = fail. e.g. if a system is spec'd to be able to track/extrapolate position of 100 moving objects and it only tracks 80 because someone slapped in a lower performing cpu then you are failing to track 20.