Taiwan Indicts Nvidia, Supermicro Employees Over AI Server Smuggling to China

Washington has restricted exports of advanced AI chips to China since 2022, making Nvidia’s B300 accelerators and servers containing them subject to strict end-user controls. Buyers must document where and how the systems will be used, while orders exceeding eight high-end servers require on-site checks. The case matters because Taiwan sits at the center of the advanced semiconductor and server supply chain, making enforcement there critical to US efforts to curb China’s access to leading AI computing power.

The Keelung District Prosecutors Office indicted nine people on Aug. 24, 2026, including an Nvidia Taiwan manager surnamed Chang and two Super Micro employees. Prosecutors called Chang a key figure in approving the release of B300 GPUs. They said 74 servers reached Chinese customers: 50 through Indonesia, eight via Japan and Hong Kong, and 16 directly. Another 56 servers were intercepted in Taiwan. Prosecutors are seeking maximum five-year prison terms for four defendants, while Nvidia said it would work with Taiwanese authorities to resolve the allegations.

Super Micro Computer is a major supplier of servers built around Nvidia’s artificial-intelligence chips. Allegations that export-controlled chips and systems were smuggled into China raise questions about compliance with US restrictions and the technology supply chain’s ability to track sensitive equipment. Whether senior management knew about the shipments is central to assessing the company’s controls and potential exposure.

Super Micro released the findings of an independent review that took five months, saying its current senior executives had no knowledge that restricted Nvidia AI chips and servers were smuggled into China. It was the company’s second externally commissioned investigation in two years. While the report cleared current management of prior knowledge, the repeated reliance on outside probes has renewed scrutiny of Super Micro’s internal audit and compliance systems.

The U.S. restricts exports of advanced AI processors and servers to China, Hong Kong and Macau in an effort to curb Beijing’s access to cutting-edge computing power. Taiwan’s Keelung District Prosecutors Office is investigating an alleged network that used shell buyers, false declarations and third-country routing to move Supermicro servers equipped with Nvidia chips. The case puts a spotlight on export compliance across Taiwan’s technology supply chain and the lucrative black market for scarce AI hardware.

Prosecutors launched a third round of searches on July 24 and questioned Nvidia senior business development manager Chang Teng-lung, alleging he issued an approval document despite knowing an order for servers carrying B300 chips was noncompliant. A court approved his detention and barred outside contact, bringing the number of people held in the case to seven. An initial May 20 operation seized 50 servers worth about NT$700 million and more than NT$9 million in cash. Reports said a server costing roughly NT$13 million could fetch nearly NT$40 million in China.

The United States restricts exports of Nvidia’s high-end AI chips and related servers to prevent advanced computing technology from reaching China. The Keelung District Prosecutors Office is investigating Taiwanese IT firms suspected of falsifying documents and routing shipments through third countries to China, Hong Kong and Macao, raising export-control and compliance concerns across Taiwan’s technology supply chain.

As of July 19, 2026, investigators had searched 12 locations, including Supermicro’s Taiwan office, Albatron Technology and Chief Telecom, as they traced the flow of goods and investigated a female Chinese financier. Three companies are accused of illegally transshipping chips and AI servers, generating more than NT$75 million in illicit profits. Prosecutors have sought court approval to detain the three principal suspects and hold them incommunicado.

The United States has tightened restrictions on exports of advanced AI chips and servers to China since 2022 to prevent cutting-edge computing power from being used for military and surveillance purposes. Super Micro, a major AI server partner of NVIDIA, has been drawn into the case through co-founder and former director Yih-Shyan “Wally” Liaw, raising questions about supply-chain compliance, the effectiveness of export controls and corporate governance.

The U.S. Justice Department announced charges on March 19, 2026, alleging that Liaw, Ruei-Tsan “Steven” Chang and contractor Ting-Wei “Willy” Sun used a Southeast Asian company, falsified documents and dummy servers to divert at least $2.5 billion of equipment between 2024 and 2025. More than $510 million of that equipment flowed into China in April and May 2025. Liaw and Sun both pleaded not guilty on April 3. Super Micro was not named as a defendant, and its shares tumbled more than 9% at one point in after-hours trading following the news.

The United States has restricted exports of advanced GPUs to China since October 2022. The Justice Department and the Commerce Department's Bureau of Industry and Security, or BIS, have since investigated shell companies, false end users and transshipments through third countries. High-end Nvidia chips and semiconductor design tools can be used for military AI, nuclear weapons simulations and surveillance systems. Efforts by China and Russia to evade controls through countries including Thailand and Malaysia have made corporate supply-chain screening a national security priority.

Encrypted messages made public on May 13, 2026, showed that Kelly and others had recruited partners since 2024 to transship Nvidia GPUs. In March, the Justice Department indicted three people, including Supermicro founder Yih-Shyan Liaw, alleging they routed $2.5 billion worth of servers through Southeast Asia. BIS imposed nearly $420 million in related penalties and forfeitures over the past 12 months and separately fined Applied Materials $252 million on February 12.