Seagate security team busts counterfeit HDD manufacturer with Malaysian police

According to the German publication Heise, у in the case of counterfeit Seagate hard drives significant progress has been made. As if on cue, security teams from Seagate’s offices in Singapore and Malaysia, along with local Malaysian law enforcement, raided a warehouse outside of Kuala Lumpur. The warehouse was used to illegally prepare counterfeit Seagate hard drives.

During the raid, law enforcement officers found approximately 700 counterfeit Seagate HDDs that had had their SMART values reset so that they could be sold as new. The confiscated batch included several models from Seagate’s wide range of capacities up to 18 TB. However, the counterfeiting was not limited to Seagate. Kioxia and Western Digital HDDs were also found.

Seagate suspects that the used drives originated in China after of the Chia cryptocurrency boom. After the cryptocurrency collapsed, many miners sold these disks to workshops where they were repackaged illegally and made to look like new. Heise estimates that at least one million such disks are in circulation, although the exact number of recovered HDDs is unknown. It should be noted that this is not the first timeChia miners sell used drives under the guise of new ones.

The illegal workshop was likely one of many such facilities and employed 6 people. Their duties included resetting SMART values, cleaning the disks, re-labeling, and repackaging them for further sale through local e-commerce platforms. Sometimes, the disks were even “upgraded” to increase their market value, for example, turning Barracuda into more expensive IronWolf or SkyHawk.

The fraud mechanism covered the entire chain from the preparation of counterfeit disks to their sale. It was this process that led to the exposure of the suspects. The criminals sold the fakes on popular platforms such as Shopee and Lazada at extremely low prices. One of the unnamed Malaysian sales managers noticed the suspicious disks and notified Seagate’s security team. The company purchased one of the disks and confirmed that it was counterfeit. Seagate then worked with local law enforcement to track the disks to the warehouse and raided the facility.

As a result of this incident, Seagate has tightened its partner program. Now, partners are contractually obliged to purchase and resell disks only through authorized Seagate distributors. In addition, the company has implemented the Global Trade Screening program to identify and exclude potentially suspicious suppliers on the sanctions list.

Although the counterfeit drives were limited to German-speaking countries, some users reported them from Australia and the United States. In a globally connected world, it would be naïve to think that no counterfeit disks have made it to the global market.

At the same time, the new discovery of counterfeit Kioxia and Western Digital drives means that consumers should be extremely cautious when purchasing HDDs from other than major retailers or third parties.

Source: tomshardware