Inspection Report on Allegations of Suspect Parts in Sun Microsystems Processors at Sandia National Laboratories - New Mexico

We were unable to substantiate the allegation that Sandia purchased suspect computer parts that were installed in Sun Microsystems processors.  However, we did find that, for a period of more than six years, CDS provided commercial-off-the-shelf Sun Microsystems products to Sandia under the JIT contract without specific quality clauses prohibiting delivery of suspect or counterfeit items

Contrary to Department of Energy (Department) guidelines, we determined that the standard clause prohibiting delivery of suspect or counterfeit items had not been included in the JIT contract with CDS.  The Department’s Guide 440.1-6 Implementation Guide for use with  Suspect/Counterfeit Items Requirements of Department of Energy Order 440.1, Worker Protection Management dated June 30, 1997, was in effect at the beginning of the CDS contract.  This guide states that purchase orders and contracts should contain quality clauses prohibiting delivery of suspect and counterfeit items.  The updated version of the Department's Guide 414.1-3, Suspect/Counterfeit ItemsGuide, dated November 3, 2004, states that purchase orders and contracts should contain specific quality clauses prohibiting delivery of suspect or counterfeit items, including provisions that prohibit subcontractors from bringing these items on site and that hold subcontractors accountable for replacing these items at their expense.

Topic: Management & Administration