Two Chinese nationals, Chuan Geng and Shiwei Yang, both 28, have been arrested in the US for allegedly smuggling tens of millions of dollars' worth of Nvidia AI chips to China. The duo used their company, ALX Solutions, to purchase over 200 Nvidia H100 chips, valued at $208,000 each, and shipped them to China via Singapore and Malaysia using fake companies.
The scheme involved claiming the chips were destined for Singapore and Malaysia, while payments were actually traced to companies in China and Hong Kong. Evidence, including text messages discussing chip shipments and potential trackers, was found on the defendants' phones.
Geng and Yang face charges of violating the Export Control Reform Act, a felony punishable by up to 20 years in prison. Geng was released on $250,000 bond, while Yang awaits a detention hearing scheduled for August 12.
The case highlights the growing strain between US technological dominance and China's hunger for cutting-edge AI capabilities. The US Department of Justice and FBI investigated the case, uncovering over 20 shipments of restricted technology. The Trump administration is exploring ways to add location trackers to AI chips to enforce export controls, underscoring the increasing importance of regulating advanced technologies.
