California Man Charged with Smuggling $300M in Nvidia AI Chips to China
A California man faces federal charges for allegedly orchestrating a scheme to illegally export approximately $300 million worth of high-end Nvidia GPUs to China, circumventing US national security regulations.
A California resident, Greg Lui, has been arrested and charged with orchestrating a sophisticated scheme to smuggle an estimated $300 million worth of advanced Nvidia graphics processing units (GPUs) to China. The GPUs, including sought-after A100 and H100 models, are critical for artificial intelligence (AI) development, and their export is heavily restricted by the US government to prevent adversarial nations from advancing their AI capabilities.
Prosecutors allege that Lui, operating through his company Earthmade Computer Inc., used a network of front companies and transshipment points in Malaysia and Singapore to bypass US export controls. The scheme, which reportedly ran from October 2023 to August 2026, involved ordering the servers containing the high-powered Nvidia components in the United States. These servers were then shipped to countries like Malaysia and Singapore, which do not require export licenses from the US Commerce Department, before being forwarded to China.
This operation aimed to circumvent US national security regulations designed to prevent the proliferation of advanced AI hardware to countries deemed adversaries, such as China. The US government views control over such technology as crucial for maintaining its technological advantage in the global race for "super intelligence" (SI), a term used to describe the most advanced AI capabilities.
According to court documents, Lui allegedly received over $176 million in payments from two Malaysian transshipment companies. In return, he facilitated the brokering of sales for nearly $300 million worth of Nvidia hardware. Prosecutors assert that Lui was fully aware of the illegality of his actions and the specific US export laws that restrict the sale of advanced Nvidia chips to China without proper licensing.
The indictment details how US authorities obtained documents linking the export of 92 servers from San Francisco International Airport to Kuala Lumpur, with Earthmade listed as the orderer. Further documentation indicated that the consignee for the onward shipment from Malaysia to Hong Kong was a Chinese customer. The scheme also allegedly involved Lui instructing a US front company to falsify shipping documents, listing a fraudulent recipient to obscure the true destination.
Lui is facing serious charges, including violations of the Export Control Reform Act and Export Administration Regulations, outbound smuggling, and money laundering. These charges carry a combined maximum prison sentence of 50 years. Federal investigators emphasized the importance of controlling the export of advanced AI technology for national security.
This case highlights the ongoing efforts by the US government to enforce export controls on cutting-edge technology, particularly AI hardware, and to prevent its diversion to nations that could use it to enhance their military or intelligence capabilities. The prosecution underscores the commitment of law enforcement agencies to hold individuals accountable for enriching themselves at the expense of national security and economic competitiveness.