Federal prosecutors have charged Greg Lui with smuggling servers containing $300 million worth of AI chips to China, the latest case in what officials describe as a growing network trying to route NVIDIA's most advanced processors around US export controls. Authorities earlier released surveillance video of someone using a hair dryer to remove serial-number stickers from NVIDIA server boxes, and officials now believe China may already have obtained 115,000 restricted NVIDIA processors, based on data center construction in western China.
The cases have intensified scrutiny of NVIDIA's due diligence. In one alleged scheme, accused collaborators including a Super Micro co-founder sold about $2.5 billion in AI servers to a Bangkok-based company, OBON, which supposedly planned to build AI infrastructure in Thailand; the servers were instead sent to end users in China, with dummy servers bearing genuine stickers used to fool compliance officers. Former State Department official Daniel Remler questioned how so many chips could go to Southeast Asia if they were not serving Chinese customers.
NVIDIA says it has followed US law and has never been accused of abetting smuggling. It pushed back on the idea that a startup's growth plan in a friendly country should be seen as a red flag, noting that NVIDIA-powered servers are financeable assets that help startups secure capital and infrastructure. The company also argues that Huawei's progress means Chinese buyers don't need to smuggle NVIDIA hardware. CEO Jensen Huang has lobbied to relax export curbs and skipped a Senate invitation, drawing a sharp rebuke from Senator Elizabeth Warren.