Prosecutors charge California owner with smuggling ~$300M of Nvidia AI chips to China

Federal prosecutors arrested California business owner Greg Lui, 38, on Thursday and charged him with allegedly smuggling about $300 million of Nvidia hardware to China without the export licenses required for that route, The Register reports. The case is the latest public enforcement shot in Washington's effort to keep the hottest AI chips out of Chinese hands.

Prosecutors say Lui used his company, Earthmade Computer Inc, to order U.S. servers loaded with high-powered Nvidia parts, including A100, H100, GeForce RTX 4090, and GeForce RTX 5090 GPUs. Those boxes then moved through U.S. freight firms and Malaysian transshipment companies into Malaysia and Singapore, two destinations that do not need Commerce Department licenses for the same gear, before going on to China. Export controls, in plain English, are the U.S. rules that require a license before certain advanced chips can ship to China. Transshipment is the routing trick that hides the final stop behind a third country.

The alleged scheme, per court documents cited by The Register, ran from around October 2023 through at least Aug. 12, 2026. Lui supposedly received more than $176 million from two Malaysian transshipment firms while brokering nearly $300 million in sales. Investigators also point to a documented export of 92 servers from San Francisco International Airport to Kuala Lumpur ordered by Earthmade, with the onward Hong Kong consignee listed as a Chinese customer, plus a front-company paperwork trail that allegedly listed a "Jackie Lui" at a California shell called Topmost. The indictment stack covers Export Control Reform Act and Export Administration Regulations counts, outbound smuggling, and money laundering, together carrying a maximum of 50 years.

Assistant Attorney General John A. Eisenberg framed the arrest as protecting America's edge in the chips that power what Washington now calls "super intelligence." The FBI's Roman Rozhavsky said the investigation showed Lui allegedly sold the Chinese government hundreds of millions of dollars' worth of that technology. The Register says it contacted Earthmade and Nvidia for comment.

The arrest lands inside a wider due-diligence fight. Engadget, drawing on Bloomberg reporting, says officials and industry critics are pressing Nvidia on how SE Asia destinations could absorb more chips than local demand explains, and how earlier networks such as the Super Micro / OBON Bangkok pipeline allegedly moved about $2.5 billion of AI servers toward China end-users while conspirators peeled serial stickers with a hair dryer. Nvidia says it has followed the rules and has never been accused of abetting smuggling. A company spokesperson told Engadget that a startup growth plan in a friendly nation is an opportunity, not a red flag, and that Chinese buyers have less need to smuggle Nvidia hardware as domestic alternatives improve.

Export controls were sold as a hard wall around the best American silicon. The Lui indictment is the government arguing the wall still has a freight door, and that nearly $300 million of Nvidia kit walked through it for almost three years.

Sources

• Californian accused of shipping $300M worth of Nvidia chips to China without Uncle Sam's approval – The Register
• NVIDIA's smuggling problem is getting worse – Engadget