Breach of Hezbollah’s devices reveals the hidden vulnerabilities within Asia’s supply chains

The recent lethal hacking incident involving Hezbollah’s Asian-branded pagers and walkie-talkies has initiated a thorough investigation into the distribution of these devices, uncovering a shadowy market for outdated technologies where consumers may lack reliable information about their purchases.

Unlike the tightly controlled supply chains and distribution networks for newer, high-margin products, older electronics from Asia often face challenges such as counterfeiting, excess inventory, and intricate contract manufacturing arrangements, making it difficult to trace the origins of these items, according to industry analysts and consultants.

The companies implicated in the booby-trapped devices, which resulted in 37 fatalities and approximately 3,000 injuries in Lebanon this week, have highlighted the complexities involved in determining how and when these products were weaponized. Gold Apollo, a Taiwan-based firm, has pointed fingers at a European licensee of its pager, leading to investigations in Hungary, Bulgaria, Norway, and Romania regarding the source of the lethal device. Meanwhile, Japan’s Icom has expressed uncertainty about the authenticity of the walkie-talkies that carry its brand, amidst a marketplace flooded with counterfeit goods.

David Fincher, a technologist and consultant based in China, remarked, “The engineering required to insert explosives into the supply chain is remarkable. However, compromising the supply chain itself is relatively straightforward. In fact, the supply chain compromise is likely the simplest aspect of the entire operation.”

He noted that counterfeit products are widespread, particularly in major manufacturing hubs like China, where fake components can be easily fabricated. He emphasized that transitioning from counterfeit components to a compromised supply chain is not a significant leap. “As a technologist, I can assure you that integrating a small explosive into a radio is not particularly challenging.”

According to a security source, Hezbollah obtained the devices approximately five months ago, believing they were purchasing pagers from Gold Apollo. The hand-held radios, reportedly acquired around the same time as the pagers, were labeled with the name of Icom, a company based in Osaka, and included the phrase “Made in Japan,” as shown in images of one of the exploded devices. Both companies have denied that any of the lethal components originated from their factories.

Taiwan’s Economy Minister Kuo Jyh-huei has also stated that the components used in the pagers that detonated in Lebanon were not manufactured in Taiwan. A preliminary investigation by Lebanese authorities indicated that the explosives were inserted before the devices arrived in the country, as detailed in a letter from Lebanon’s mission to the United Nations to the U.N. Security Council.

Currently, the only certainty is the lack of clarity surrounding the weaponization of pagers and walkie-talkies for remote detonation. Joe Simone, a partner at the Chinese intellectual property firm East IP, highlighted that smaller brands often allocate fewer resources to combat counterfeiting, primarily due to the financial implications that could affect their bottom line.

“While authorities are willing to address low-tech counterfeits, it falls on IP owners to actively monitor, investigate, and file complaints, which is not always as prevalent for smaller brands compared to larger, high-tech companies,” he noted.

For Icom, a significant challenge arises from the fact that the IC-V82 model was discontinued a decade ago, coinciding with the introduction of holographic stickers intended to combat counterfeit products. The company has consistently raised concerns about imitation products, particularly those related to its older models.

According to the latest report from the Japan Patent Office, over 7% of businesses in Japan experienced losses due to counterfeit goods in 2020, with approximately one-third of these cases linked to China. Icom has advised customers to purchase exclusively through its official distributor network to guarantee the authenticity of their products.

However, numerous shops in China are offering Icom-branded walkie-talkies on e-commerce platforms like Alibaba.com, Taobao, JD.com, and Pinduoduo, including instances of the IC-V82 model, as verified by Reuters. Among three vendors of Icom products on Alibaba.com, none were recognized as official suppliers on Icom’s website. Guangzhou Minxing Communications Equipment Co and Chengdu Bingxin Technology Co Ltd both claimed to sell genuine products, while Quanzhou Yitian Trading Co admitted to offering “Chinese made imitations” alongside original items.

Icom maintains that all its products are manufactured in its Japanese factories and has not yet responded to inquiries regarding Icom-branded products available on Chinese online platforms.