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Los Angeles, CA – August 7, 2024 – Two individuals have been arrested and charged with illegally exporting high-performance microchips, including those manufactured by Nvidia and super Micro, to China, the U.S. department of Justice announced today. The alleged scheme circumvented U.S. export controls designed to prevent sensitive technology from falling into the hands of the Chinese military.
According to court documents,Lianfeng Chen,also known as Erica Chen,34,of Alhambra,California,and Guangyao Yang,33,a Chinese national residing in Los Angeles,operated ALX Technology,a shell company used to procure and ship the chips. A $28.45 million invoice from 2023 detailed a shipment purportedly destined for singapore. However, a U.S. export control officer stationed in Singapore confirmed the chips never arrived and that the listed customer, identified as “Xingtai Technology,” did not exist at the provided address.
The investigation, led by the Justice Department’s counterintelligence and Export Control Section, revealed that ALX Technology allegedly acquired the chips from multiple U.S.suppliers, including Super Micro computer, Inc., and then re-routed them thru front companies to ultimately reach destinations in China. The chips included high-end graphics processing units (gpus) and other components with applications in artificial intelligence, machine learning, and high-performance computing.
Nvidia issued a statement emphasizing its commitment to compliance. “This case demonstrates that smuggling is a nonstarter,” a spokesperson said. “We primarily sell our products to well-known partners who help us ensure that all sales comply with U.S. export control rules.” The company further stated that diverted products lack official service, support, or updates.
Super Micro also released a statement affirming its “firm commitment to compliance with all U.S. export control regulations.” The company declined to comment on the specifics of the ongoing legal proceedings but confirmed its full cooperation with authorities.
Chen and Yang made their initial appearances in federal court in Los Angeles on Monday. Chen, a lawful permanent resident of the United States, was released on a $250,000 bond.Yang, who is alleged to have overstayed her visa, is scheduled for a detention hearing on August 1
