Two Chinese Nationals Arrested for Illegal Export of Nvidia AI Chips to China

On August 5, 2025, the U.S. Department of Justice announced the arrest of two Chinese nationals, Chuan Geng and Shiwei Yang, both 28 and residing in California, for allegedly exporting tens of millions of dollars' worth of advanced Nvidia AI chips to China without the required export licenses. The duo faces charges under the Export Control Reform Act, which carries a maximum penalty of 20 years in prison.

Geng and Yang operated ALX Solutions Inc., a company based in El Monte, California, established in 2022. Between October 2022 and July 2025, ALX Solutions allegedly conducted over 20 shipments of sensitive technology to China, including more than 200 Nvidia H100 GPUs. These shipments were routed through Singapore and Malaysia—common transshipment points used to conceal illegal exports to China. The company is accused of falsifying end-user information, declaring destinations as Singapore and Japan, while the actual recipients were in China.

Financial records indicate that ALX Solutions received numerous payments from companies based in Hong Kong and China, including a $1 million payment from a China-based company in January 2024. These payments did not correspond with the declared destinations of the shipments. The company sourced the Nvidia H100 chips from Super Micro Computer, a server manufacturer based in San Jose, California. One invoice alone was valued at over $28 million. U.S. export control officers later determined that the declared recipient company in Singapore did not exist at the listed address.

At their initial appearance in U.S. District Court in Los Angeles, Geng was released on a $250,000 bond. Yang, who overstayed her visa, faces a detention hearing on August 12.

A spokesperson for Nvidia stated, "This case demonstrates that smuggling is a nonstarter. We primarily sell our products to well-known partners...who help us ensure that all sales comply with U.S. export control rules." Super Micro Computer emphasized its commitment to compliance with all U.S. export control regulations and stated it would cooperate with authorities.

This case underscores the ongoing technological competition between the U.S. and China. The U.S. has implemented strict controls on semiconductor exports to prevent China from accessing cutting-edge AI technology with potential military applications. Reports indicate that between May and July 2025, over $1 billion worth of Nvidia's high-end AI chips were smuggled into China, circumventing U.S. export controls. This highlights the challenges in enforcing export restrictions and the demand for advanced AI hardware in China.

U.S. legislators have criticized decisions to resume shipments of certain AI processors to China and have called for dynamic export rules that adapt to China's evolving domestic capabilities.

The arrest of Geng and Yang highlights the ongoing challenges in enforcing U.S. export controls on advanced technologies. As the U.S. continues to tighten restrictions to prevent sensitive technology from reaching unauthorized entities, this case serves as a reminder of the complexities involved in regulating global technology transfers.