US chipmakers should do more to keep chips out of Russian weapons, senator says

By Thomson Reuters Feb 27, 2024 | 2:19 PM

By Karen Freifeld

(Reuters) – U.S. semiconductor manufacturers should do more to keep their chips from illegally making their way into equipment used by the Russian military, U.S. Senator Richard Blumenthal said at a hearing on Tuesday.

Blumenthal’s comments came as reports show U.S.-origin chips and other technology continue to be found in a wide range of Russian equipment on the battlefield in Ukraine, from drones and radios to missiles and armored vehicles.

His remarks were aimed at U.S. chipmakers like Advanced Micro Devices, Intel Corp, Texas Instruments and Analog Devices, after reports of their products in Russian equipment or flowing to Russia, despite U.S. export controls.

The companies “have the capacity to trace and track those components well enough to do something more,” Blumenthal, chair of the Senate’s Permanent Subcommittee on Investigations, said at the hearing looking into how U.S. chipmakers are complying with export restrictions imposed after Russia’s invasion in February 2022.

The subcommittee has already sought documents and information from the four chipmakers. Preliminary data shows significant increases since 2021 in exports to countries that Russia may be using to evade controls, according to a memo by the committee majority staff.

Three witnesses who testified at the hearing described how their organizations have tracked the use of U.S. chips and components in Russian weaponry.

“Russia acquires chips using third-country distributors which can be identified,” said Damien Spleeters of Conflict Armament Research, a UK-based organization which found U.S.-origin parts in Russian weapons.

Elina Ribakova of the Kyiv School of Economics said the components tend to be produced in places like China, Malaysia and the Philippines, and reach Russia through Turkey, the UAE and countries bordering Russia.

Senator Ron Johnson, the ranking member of the subcommittee, took the view that sanctions would always be evaded. “You plug one hole, another hole is going to be opening up,” he said.

Intel said its contracts require customers and distributors to comply with regulations, and that it works to track and mitigate potential distributor issues.

AMD said it “welcomes strengthening public/private partnerships to combat illicit product diversion.” It said it takes action when AMD products are being diverted, and works with global customs and others to stop illegitimate shipments.

Texas Instruments said it invests “significant time and resources” to keep its chips “out of the hands of bad actors.”

Analog Devices did not immediately respond to a request for comment but said last week it was cooperating with the Senate panel.

(Reporting by Karen Freifeld; editing by Chris Sanders and Jonathan Oatis)