EH-92-4 DOE Quality Alert ENVIRONMENT, SAFETY & HEALTH BULLETIN Assistant Secretary for U. S. Department of Energy Environment, Safety & Health Washington, D.C. 20585 DOE/EH-0266 Issue No. 92-4 August 1992 DOE QUALITY ALERT Counterfeit Parts This Bulletin provides a summary of information that has been disseminated by various organizations within the Department of Energy (DOE) to alert the DOE community that some vendors have sold substandard bolts and circuit breakers to its contractors. Such sales can be a crime. In certain cases, suppliers of these substandard parts may also be subject to the civil penalty enforcement provisions of the Price Anderson Amendments Act of 1988. DOE contractors have reported in excess of 1,000,000 suspect/counterfeit bolts and over 700 suspect/counterfeit circuit breakers to the Department. Counterfeit/Substandard High-Strength Bolts Counterfeit bolts have been found in military and commercial aircraft, surface ships, submarines, nuclear weapon production facilities, bridges, buildings, and the space shuttle. These bolts often do not possess the capabilities of the genuine bolts they counterfeit and can threaten the reliability of industrial and consumer products, National Security, or lives. At Congressional hearings in 1987, the Army testified that they had purchased bolts that bore the headmarks of Grade 8 high-strength bolts but that were actually inferior Grade 8.2 bolts. The International Fasteners Institute (IFI) reported finding substandard, mismarked, and/or counterfeit, high-strength Grade 8 bolts in the United States commercial marketplace. In 1988, IFI reported that counterfeit medium-strength Grade 5 bolts had also been found. Foreign bolts dominate the American marketplace due to their price advantage, and the majority of suspect/counterfeit bolts are imported. Identifying, testing, and replacing these bolts has proven expensive and difficult, both mechanically and technically. Not finding and replacing these bolts, however, has proven fatal in some instances. Fatalities From Substandard Bolts A Report of the Subcommittee on Oversight and Investigations of the Committee on Energy and Commerce of the U.S. House of Representatives entitled The Threat from Substandard Fasteners: Is America Losing Its Grip? dated July 1988 stated the following under the heading "Saturn Corporation, Tennessee": A death has occurred, in part, because a bolt...broke as an iron worker was tightening it. The iron worker lost his balance and fell, missing the safety net. The bolt, manufactured in Mexico or Spain, was substandard. The Los Angeles Times printed a story under the headline "Counterfeits Now Nuts, Bolts Issue" in January 1989, which included the following: Several people have died in crashes involving private planes that officials determined were caused by defective fasteners...the nuts, bolts and screws that hold together an aircraft. The National Transportation Safety Board's computer database indicated there were 61 aviation accidents between 1984 and 1987 caused by bad fasteners. How many of those fasteners were counterfeited is just now being investigated. And just last summer, three different military planes at Tinker Air Force Base in Oklahoma experienced engine failure as a result of defective bolts that may have been counterfeit... The Houston Post ran a story with the headline, "Fatal Navy fire blamed on faulty bolt" on March 15, 1992, which stated the following: A Feb. 22 fire aboard a Navy destroyer that killed two sailors and injured four was caused by a faulty bolt in the ship's engine room...the fire broke out aboard the steam-powered vessel after a stainless steel bolt connecting a high-pressure steam line sheared...a closer analysis of the bolt...showed it hadn't been sold to the Navy by any known domestic company, and sources speculate that it might have been a foreign-made fastener. Fastener Quality Act Congress has passed legislation aimed at curbing future bolt counterfeiting. The Fastener Quality Act was passed by Congress in November 1990 to impose sanctions upon those who sell untraceable fasteners or bolts. However, the Act has not been implemented. When testing laboratories and regulations are established by the Department of Commerce, the Senior Nuclear Managers Group (SNMG) will amend the guidance issued March 12, 1992. DOE contractors have reported suspect/counterfeit bolts in several different ways. Some have weighed bolts and reported them in pounds, and others have counted the bolts and reported the actual numbers. As of June 1992, DOE contractors have reported finding in excess of 1,000,000 suspect/counterfeit bolts. Indicators - Headmarks There are several consensus organizations that have published standards for the properties of fasteners. One of these is the Society of Automotive Engineers (SAE). The SAE grade or alleged grade of a bolt is indicated by raised or indented radial lines on the bolt's head, as shown in Figure 1. These markings are called headmarks. DOE is currently concerned with two different grades of fasteners: one has three equally spaced radial lines on the head of a bolt which indicate that it should meet the specifications for a Grade 5 bolt; the other has six equally spaced radial lines which indicate a Grade 8 bolt. Letters or symbols on the head of a bolt indicate the manufacturer. Figure 1 is a suspect/counterfeit Headmark List that was prepared by the United States Customs Service after extensive testing of many samples of bolts from around the nation. Any bolts anywhere in the DOE community that are currently in stock, in bins, or installed that are on the Customs Headmark List should be considered suspect/counterfeit. The headmarks on this list are those of manufacturers that have often been found to have sold bolts that did not meet the indicated consensus standards. Sufficient testing has been done on the bolts on this list to presume them defective without further testing. Posters and Headmarks Figure 1 may be removed and photocopied as needed for use as a poster and handy reference to known suspect fastener headmarks. Bolts with the headmarkings shown have a significant likelihood of being found to be inferior to standards. Generally, the cost of replacement of these bolts is less than the cost of chemical, hardness, and tensile strength testing. Note also that counterfeit bolts can be delivered with counterfeit certificates--documentation alone is insufficient to demonstrate compliance with standards. The Fastener Quality Act of 1990 will require the registration of the headmarks of manufacturers, and it also will require everyone in the distribution chain to ensure bolt traceability. Current Activities SNMG took action in December 1990 to disseminate information for substandard material to field activities. Subsequently, the group developed a plan of action with two purposes, viz., (1) to determine the scope of the problem and to take immediate corrective actions as appropriate, and (2) to provide guidelines for strengthening the procurement process so as to preclude the acceptance of counterfeit parts in the future. Consistent with SNMG guidance, each site should: 1. Continue inspection of inventories and systems for suspect/counterfeit parts, 2. Continue review and revise procurement and quality assurance procedures so that the problem does not recur, and 3. Continue to detect any new attempts by unscrupulous vendors to supply substandard parts. Precautions The following precautions should be recognized when addressing the issue of suspect/counterfeit parts: 1. Selective Testing--Some facilities perform selective testing of sample bolts rather than have an independent testing laboratory run all the tests required by consensus standards. In many cases, a new counterfeit bolt has roughly the same physical strength as the graded bolt it mimics, but does not have either the chemical composition or the heat treatment specified by the consensus standards. As a result, it will stretch, exhibit metal fatigue, or corrode under less harsh service than the genuine bolt. Simple tensile strength tests cannot be used to identify substandard high- strength fasteners and should not be solely relied upon in performing acceptance tests. 2. Using Suspect/Counterfeit Grade 5 Bolts in Grade 2 Applications-- Some sites use suspect/counterfeit Grade 5 bolts in applications that only call for Grade 2 bolts. Eventually the suspect/counterfeit Grade 5 bolts will be used in an application that requires a genuine Grade 5 bolt and that application may fail. In some cases, cheap imported graded bolts have been purchased in place of ungraded bolts because the small price differential made the extra quality seem to be a bargain. Given the expense of removing suspect bolts from DOE facilities, the practice of using suspect bolts for any application should be stopped. 3. Keep Bolts in Original Packages--All bolts purchased should be kept in the original packages, not emptied into bins. The packages should have labels or other markings that would permit them to be associated with a particular procurement action and a specific vendor. Approved vendor lists should be checked to assure that fastener vendors on that list have been audited for adequacy of their quality programs recently. Disposition Consistent with SNMG guidance: 1. Segregate and retain all suspect/counterfeit bolts including those found with headmarks that match those on the U.S. Customs Service Headmark List shown in Figure 1. The Office of Inspector General and the Office on Nuclear Safety should be notified when suspect/counterfeit bolts are being retained. These should be retained as potential evidence until specifically released by the Office of Inspector General and the Office of Nuclear Safety for Price Anderson Enforcement. Bolts on the Headmark List may only be disposed of when the above organizations no longer need them as evidence. 2. Report all suspect/counterfeit bolts. Regardless of use or test results, it is imperative that all suspect/counterfeit bolts be reported to ORPS in accordance with DOE 5000.3A, Occurrence Reporting and Processing of Operations Information, Attachment 1, "Categorization of Reportable Occurrences." The reports should include identification of the particular headmark, the number of bolts found with that headmark, and the supplier. 3. Report to the Office of Inspector General cases where there are indications that suppliers knowingly supplied items and services of substandard quality. 4. Witness and document the melt down of all suspect/counterfeit bolts when approval is given for disposal as discussed in No. 1 above. As appropriate, DOE contractors should also report on the SPMS which provides more detailed information. To obtain a password for access to this system, contact Rick Edwards (208)526-1099. Suspect Equipment Reports (SER) can be found in the Supplier Evaluation and Suspect Equipment (SESE) data base on the ES&H News menu of the SPMS. Only SER representatives can enter data into SER. If there is no SER representative at your site, or if you wish to have data entry access, contact Janet Macon (301)903-6096. Refurbished Molded-Case Circuit Breakers Investigations thus far of electrical components at DOE facilities uncovered over 700 suspect/counterfeit molded-case circuit breakers that were previously used, refurbished and sold to DOE contractors. The following factors should be recognized regarding suspect or refurbished circuit breakers. 1. The quality and safety of refurbished molded-case circuit breakers is questionable since they are not designed to be taken apart and serviced or refurbished. There are no electrical standards established by Underwriters Laboratory (UL) for the refurbishing of molded-case electrical circuit breakers, nor are there any "authorized" refurbishers of molded-case circuit breakers. Therefore, "refurbished" molded-case circuit breakers should not be accepted for use in any DOE facility. 2. One source of refurbished molded-case circuit breakers is from the demolition of old buildings. Some refurbishers are junk dealers who may change the amperage labels on the circuit breakers to conform to the amperage ordered and then merely clean and shine the breakers. This situation was brought to DOE's attention by the Nuclear Regulatory Commission (NRC) which, in turn, had been informed of the practice by the company that manufactures circuit breakers. In early 1988, a sales representative identified "refurbished" circuit breakers at Diablo Canyon Nuclear Power Plant. A subsequent investigation confirmed that circuit breakers sold to the power plant as new equipment were actually refurbished. The managers of the two firms that refurbished and sold these breakers have been convicted of fraud and have paid a substantial fine. 3. NRC published Information Notice No. 88-46 dated July 8, 1988, on the investigation findings and circulated it to all applicable government agencies, including DOE. On July 20, 1988, DOE notified all field offices that refurbished circuit breakers may have been installed in critical systems. Shortly thereafter, DOE established the Suspect Equipment Notification System (SENS), a submodule of ES&H Events and News on the Safety Performance Measurement System (SPMS). SENS has since been replaced by the Supplier Evaluation and Suspect Equipment (SESE) submodule which includes Suspect Equipment Reports. 4. Some of DOE's older sites have circuit breakers in use that are no longer manufactured. According to the Nuclear Management and Resources Council (NUMARC), examples of such breakers are Westinghouse breakers with frames E, EA, F and FA. If a DOE contractor has an electrical box that requires a breaker with one of these frame sizes, that contractor would not have been able to purchase it from Westinghouse for several years. If the contractor were to order a replacement breaker from an authorized Westinghouse dealer, the dealer could not get a new replacement breaker from the manufacturer. To fill the order, the dealer had to turn to the secondary or refurbished market. Dealing with an authorized distributor does not preclude ending up with refurbished circuit breakers. Westinghouse has announced that it is considering satisfying this market by manufacturing circuit breakers that will fit in these applications. The solution, as recommended by NUMARC, is not to focus on the credentials of the distributor but on the traceability of the circuit breaker itself. A purchaser can be assured of having a new circuit breaker only if the breaker can be traced back to the original manufacturer. Indicators of Refurbished Breakers Typically, refurbished circuit breakers sold as new equipment have one or more of the following characteristics: o The style of breaker is no longer manufactured. o The breakers may have come in cheap, generic-type packaging instead of in the manufacturers' original boxes. o Refurbished circuit breakers are often bulk-packaged in plastic bags, brown paper bags, or cardboard boxes with handwritten labels. New circuit breakers are packed individually in boxes that are labeled with the manufacturer's name, which is usually in two or more colors, and are often date stamped. o The original manufacturer's labels and/or the Underwriters Laboratory (UL) or Factory Mutual (FM) labels may have been counterfeited or removed from the breaker. Refurbishing operations have been known to use copying machines to produce poor quality copies of the original manufacturer's and the certifying body's labels. o Breakers may be labeled with the refurbisher's name rather than the label of a known manufacturer. o The manufacturer's seal (often multicolored) across the two halves of the case of the breaker is broken or missing. o Wire lugs (connectors) show evidence of tampering. o The surface of the circuit breaker may be nicked or scratched yet have a high gloss. Refurbishers often coat breakers with clear plastic to produce a high gloss that gives the casual observer the impression that the breaker is new. The plastic cases of new circuit breakers often have a dull appearance. o Some rivets may have been removed, and the case may be held together by wood screws, metal screws, or nuts or bolts. o Contradictory amperage ratings may appear on different parts of the same refurbished breaker. On a new breaker, the amperage rating is stamped into, raised from, or machine-painted on the handle of the circuit breaker. In order to supply a breaker with a hard-to-find rating, refurbishers have been known to file down the surface of the handle to remove the original rating and hand-paint the desired amperage rating. Testing In a news release dated February 6, 1989, the National Electrical Manufacture's Association (NEMA) announced the cancellation of its Publication AB-2-1984 entitled, "Procedures of Field Inspection and Performance Verification of Molded-Case Circuit Breakers used in Commercial and Industrial Applications," and stated the following: These procedures were intended for use with breakers that had been originally tested and calibrated in accordance with NEMA Standards Publication AB 1 or Underwriters Laboratories Standard UL 489, and not subsequently opened, cleaned or modified.... Therefore the Standards Publication contained none of the destructive test procedures...necessary to verify the product's ability to withstnad such conditions as full voltage overload or short circuit. Without such tests, even if a rebuilt breaker had passed the tests specified in AB-2, there would be no assurance that it would not fail under overload or short circuit conditions. It is NEMA's position that regardless of the results of electrical testing, refurbished electrical circuit breakers are not reliable and should not be used. Precautions Follow these precautions regarding suspect or refurbished circuit breakers. 1. Require that molded-case breakers be new and unaltered. Proof that they are new and unaltered requires the vendor to show traceability back to the original manufacturer. 2. Do not rely completely on dealing with authorized dealers for protection from purchasing refurbished molded-case circuit breakers. 3. Approve formal procedures for inspecting circuit breakers that are received and installed according to the indicators of refurbished breakers listed above. 4. Contact the original manufacturer if any indication of misrepresentation is encountered. There are many original manufacturers of molded-case circuit breakers whose products are being refurbished and sold as new. These manufacturers have the most specific information about how to assure that their products have not been refurbished. Disposition x 1. Segregate and retain all circuit breakers found with indications that they may be refurbished. These will be retained as potential evidence until specifically released by the Office of Inspector General and the Office of Nuclear Safety for Price Anderson Enforcement. Circuit breakers that may be refurbished may only be disposed of when the above organizations no longer need them as evidence. 2. Report suspect electrical components to ORPS and as appropriate to the Suspect Equipment Reports (SER) on SPMS. The ORPS categorization group should be identified as "Cross-Category Items, Potential Concerns or Issues." The description of cause section in the ORPS report should include the text "suspect counterfeit parts." 3. Witness and document the destruction of all suspect/counterfeit circuit breakers when approval is given for disposal as discussed in No. 1 above. Additional Information The Office of Nuclear Energy has the responsibility for resolving the suspect/counterfeit parts issue in the Department. Further guidance as it is developed will be disseminated to the Field Offices. This Bulletin is one in a series of publications issued by EH to share occupational safety information throughout the DOE complex. To be added to the Distribution List or to obtain copies of the publication, call (615)576-3482. For additional information regarding the publications, call Barbara Bowers, Safety Performance Indicator Division, Office on Environment, Safety and Health, U.S. Department of Energy, Washington DC 20585, (301)903-3016. **NOTE** Figure 1 is not contained in this document.  .