NetworkTigers on how to avoid purchasing counterfeit network equipment and what to do if you buy some by mistake.

Counterfeit network gear, both hardware and software, leeches approximately $100 billion annually across IT industries. While it’s understandable to shop around for the best deal, counterfeit networking equipment has flooded the market with substandard and sometimes dangerous goods. 

Counterfeiting is a crime

Approximately 19% of goods seized in FY2021 by US Customs and Border Protection were classified as consumer electronics, including computers and accessories. The import of counterfeit electronics is illegal and may result in civil fines or criminal charges. 

A counterfeit scheme can victimize anyone. In one recent 2022 Department of Justice indictment, a Florida resident was charged with running a years-long scam selling counterfeit Cisco gear that, if authentic, would have totaled over $1 billion in retail value. The scam involved over 19 sellers (collectively, “Pro Network Entities”) across Amazon, eBay, and other storefronts that imported counterfeit Cisco network gear made in China and Hong Kong. The routers and gear routinely malfunctioned and left clients, including schools, hospitals, government agencies and the US military, open to data breaches and wireless access meltdowns. 

The risks of counterfeit electronic equipment

Counterfeit networking equipment often contains crucial safety shortcuts that can open your business to data breaches. Its manufacture may support criminal activity and unsafe labor practices. Finally, counterfeit networking equipment may be physically dangerous. Consumer Reports shares that 99% of counterfeit Apple iPhone chargers fail one or both electric strength tests and touch current tests. Both tests are in place to measure fire risk and electrical shock. Failing either puts the consumer’s physical safety in jeopardy. 

Counterfeit network equipment, especially routers and switches, is hazardous for a business. They may appear to do the same job, but have bypassed internal authentication software designed to keep a network secure. They may involve intentional backdoors or play host to modified software or firmware. Counterfeit network equipment by design is less secure than verified gear. If it does not introduce viruses and malware into your system from the start, its security defenses are easier for hackers to breach. Finally, counterfeit gear regularly malfunctions, forcing your business to bear the cost of replacement gear sooner than it should. 

How to spot and avoid counterfeit networking gear

Worried you may have accidentally bought counterfeit networking gear? Here’s how to check, and how to avoid doing so again: 

1. Look for the hologram: Holographic security features are difficult to replicate. The background should change when tilted. Look up reputable providers’ holographs, and ensure that the seal on your device matches the design, placement, and expected quality. 
2. Compare the price: If the price is too good to be true, it’s often a red flag for a fake product. While everybody wants a deal, counterfeit goods are often offered far below expected market value to sidestep pesky questions about their performance. Saving money on the initial sticker will only lead to headaches. 
3. Source from authorized channels: Buying from reputable dealers or directly from the manufacturer is one of the best ways to ensure that your network connectivity gear is authentic. 
4. Buy with a warranty: Authorized resale and third-party channels may offer a warranty as additional peace of mind that the gear they sell is legitimate. Buying from a party that offers a warranty is a way to ensure that the product you have is the real deal and made to last. Maintaining service contracts can help ensure that you remain in communication with sellers and their sources. 
5. Audit: Sprawl and IT expansion makes auditing a necessary step to avoid introducing counterfeit replacement parts. Even if you are certain that everything you’ve invested in is above-board, there is no guarantee a predecessor did not attempt to cut costs with counterfeit gear. Conducting a regular audit can help ensure that threats are not being introduced without your awareness. 

What to do if you’ve bought some counterfeit network equipment by mistake

A three-step reporting process is recommended if you recognize counterfeit gear anywhere along your network connection.

1. Reach out to your internal legal team. Because knowingly purchasing counterfeit goods can carry civil and criminal penalties, speaking to your company’s in-house attorney is an important step. 
2. Contact law enforcement. US Customs agents may be able to stop the counterfeit import source. 
3. Tell the manufacturer who sold it to you. They may offer you a discount on future gear, but it is worthwhile to assess whether or not you feel you can trust continued investments.

The last thing you want for your business is to be embroiled in a customs fraud or counterfeiting scheme. Contacting all three professionals can help block a counterfeit supply chain’s access. Informing your legal department can help mitigate or reduce your internal liability. Protect your bottom line by regularly auditing and reporting concerns about your company’s networking equipment.