Super Micro Co-Founder Charged With Smuggling $2.5 Billion in Nvidia AI Chips to China

U.S. federal prosecutors have indicted three individuals connected to server company Super Micro Computer — including one of its co-founders — for allegedly smuggling approximately $2.5 billion worth of Nvidia-powered AI servers to China via Taiwan. Super Micro's stock plunged 28% on Friday following the announcement.

Those charged are Yih-Shyan Liaw, Ruei-Tsang Chang, and Ting-Wei Sun. Liaw is confirmed by Super Micro to be a former co-founder and executive of the company. All three face charges of conspiracy to violate the Export Controls Reform Act, conspiracy to smuggle goods, and conspiracy to defraud the United States.

Prosecutors allege that the defendants systematically rerouted Nvidia GPU-equipped servers through intermediaries in Taiwan to Chinese end-recipients — in direct violation of U.S. export restrictions. The Justice Department described it as the most high-profile crackdown on illegal diversion of AI technology to China to date.

Each of the most serious charges carries a sentence of up to 20 years in prison. Super Micro said it is cooperating fully with authorities and emphasised the alleged conduct was not company-sanctioned.

The case lands amid intensifying U.S. efforts to control the flow of advanced AI hardware to China. The Biden administration imposed sweeping export controls in January 2025; the Trump administration has since extended and tightened them. Analysts warn the case signals elevated political and legal risk for the entire AI hardware supply chain.