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March 22, 2026
3 minutes read

Super Micro Co-Founder Indicted For Smuggling Nvidia Chips

Yih-Shyan “Wally” Liaw, a co-founder of Super Micro Computer (NASDAQ: SMCI), a leading server producer, has been indicted by the…

Yih-Shyan “Wally” Liaw, a co-founder of Super Micro Computer (NASDAQ: SMCI), a leading server producer, has been indicted by the U.S. Justice Department for smuggling high-performance AI servers powered by Nvidia chips to China, in violation of export restrictions. Liaw was indicted alongside Ruei-Tsang “Steven” Chang, another Super Micro employee, and Ting-Wei “Willy” Sun, a contractor.

The U.S. government accused the trio of conspiring to sell billions of dollars’ worth of servers containing high-performance, export-restricted Nvidia chips to companies in China. They allegedly shipped the servers to Southeast Asia, which were then placed in unmarked boxes and sent to China, while using false documents to claim that a customer in Southeast Asia was the end user.

Prosecutors claim an unnamed company in Southeast Asia bought $2.5bn worth of Super Micro servers, which were assembled in the U.S., and diverted them to China.

As the U.S. and China face fierce competition for AI dominance, the U.S. government has restricted exports of high-performance Nvidia AI chips to Chinese companies. Export restrictions have also been placed on Russia and several Middle Eastern countries, citing national security risks.

The Trump administration has balanced export restrictions with conditional licenses for selling modified AI chips to China. Yet, with Chinese companies and government entities seeking the most sophisticated AI chips, some have found opportunities in smuggling them at lucrative margins. The U.S. government has indicted various individuals for Nvidia chip smuggling.

Liaw, Chang, and Sun are each charged with one count of conspiring to violate the Export Controls Reform Act, one count of conspiring to smuggle goods from the United States, and one count of conspiring to defraud the United States. The case was filed in the Southern District of New York.

As usual, defendants are presumed innocent and have the opportunity to defend themselves in court. Liaw is a U.S. citizen, while Chang and Sun are citizens of Taiwan, where Super Micro operates major manufacturing facilities.