On Monday, online retailer NewEgg confirmed that the shipment of Core i7s processors was fake, and it has cut off its dealings with IPEX, the supplier.

At first, Newegg said that it was a shipping mistake since there were some orders asking for demo boxes instead of functional units.

At a later stage, Newegg claimed that Ipex Infotech of Fremont, California, had supplied the fake processors. Newegg said that Ipex had by mistake shipped demo units.

Newegg said, "We have since come to discover the CPUs were counterfeit and are terminating our relationship with this supplier".

"Contrary to any speculation, D&H Distributing is not the vendor that supplied us with the Intel Core i7-920 CPUs in question", Newegg said in a latter statement.

Newegg said it is reaching out to all customers who might have received the fake processors. It is sending out number of replacement units and doing everything in its hands to crack the problem quickly to avoid further inconvenience to its customers.

Daniel Snyder, an Intel Spokesman, said, "Intel is getting samples to inspect and until then we can say that everything in the package appears fake".