Big AI‑chip smuggling indictment
Three men tied to Super Micro Computer were charged with diverting about $2.5 billion in Nvidia AI chips to China in a scheme that allegedly evaded U.S. export controls—Supermicro stock plunged on the news. The case exposes persistent vulnerabilities in hardware supply chains and compliance enforcement. (nbcnews.com)
The indictment names Yih‑Shyan “Wally” Liaw (a Supermicro co‑founder and then‑Senior VP of Business Development) and Ting‑Wei “Willy” Sun as arrested and presented in the Northern District of California, while Ruei‑Tsang “Steven” Chang is described as a fugitive. (justice.gov) Prosecutors say at least about $510 million worth of U.S.‑assembled servers were diverted to China between late April 2025 and mid‑May 2025 as a discrete tranche inside a broader pattern of purchases. (justice.gov) The indictment identifies shipments containing Nvidia’s AI GPUs — including B200 and H200 models tied to the Blackwell architecture — as the controlled components at the center of the scheme. (pcmag.com) Federal authorities allege a playbook of fake end‑user paperwork, Southeast Asian “pass‑through” buyers, staged non‑working dummy servers to fool audits, and physical manipulation of serial‑number stickers (investigators even cite using a hair dryer to remove and reapply labels). (justice.gov) The case was unsealed in the Southern District of New York and assigned to U.S. District Judge Edgardo Ramos, with prosecution led by Assistant U.S. Attorneys Juliana N. Murray, David J. Robles and Kevin T. Sullivan and assistance from Trial Attorneys Maria Fedor and Mark Murphy of the DOJ’s National Security Division. (justice.gov) Supermicro’s official release says the company is not named as a defendant, that it placed the two employees on administrative leave and terminated the contractor, and company filings later show Liaw resigned from the board; public filings and reporting indicate Liaw controlled roughly $464 million in Supermicro shares. (supermicro.com) (cnbc.com)
