Two Chinese Nationals Charged for Smuggling Nvidia Chips to China

Two Chinese nationals, Chuan Geng and Shiwei Yang, face federal charges for smuggling millions of dollars worth of Nvidia's advanced AI chips to China, circumventing US trade restrictions. The scheme involved routing shipments through Singapore and Malaysia and falsifying end-user information to major distributors. Nvidia emphasizes its commitment to export control compliance, stating that smuggling chips is a "non-starter."

Two Chinese nationals, Chuan Geng and Shiwei Yang, have been arrested and charged with smuggling millions of dollars worth of Nvidia's advanced AI chips to China, according to the U.S. Department of Justice (DOJ). The scheme involved routing shipments through Singapore and Malaysia and falsifying end-user information to major distributors.

The DOJ alleges that the defendants used a California-based company, ALX Solutions, to export the chips without the required licenses. The company is accused of sending at least 20 shipments to shipping and freight-forwarding companies in Singapore and Malaysia, but receiving payments from entities in Hong Kong and China. The H100 AI accelerators, designed by Nvidia, were among the chips being smuggled. These chips are considered the most powerful on the market and are crucial for AI software development [1].

Nvidia has emphasized its commitment to export control compliance, stating that smuggling chips is a "non-starter." The company primarily sells its products to well-known partners who help ensure all sales comply with U.S. export control rules. Even relatively small exporters and shipments are subject to thorough review and scrutiny. Any diverted products would have no service, support, or updates [1].

The U.S. government is exploring solutions to curb chip smuggling, including implementing tracking technology into chips to help catch smuggling. However, chipmakers like Nvidia are opposed to such a move, arguing that it would compromise security and undermine trust in U.S. technology [1].

This case highlights the ongoing struggle between fostering global AI innovation and imposing export restrictions on China, which is seen as a major threat in the AI race. The Trump administration's AI Action Plan emphasized the importance of strong export restrictions but lacked specifics [1].

References:
[1] https://techcrunch.com/2025/08/06/two-arrested-for-smuggling-ai-chips-to-china-nvidia-says-no-to-kill-switches/
[2] https://www.business-standard.com/world-news/two-chinese-nationals-held-in-us-for-smuggling-nvidia-ai-chips-to-china-125080600223_1.html
[3] https://www.bbc.com/news/articles/c4gm921x424o