Federal Agents Arrest Chinese Nationals for Smuggling Nvidia’s High-End GPUs to China, Evading US Export Controls
Two Chinese nationals, identified as Chuan Geng and Shiwei Yang, have been apprehended by federal authorities for allegedly smuggling Nvidia’s high-end graphics cards and AI GPUs into China, violating U.S. export controls. The suspects are believed to have operated from their Los Angeles-based company, ALX Solutions.
The alleged illicit activities took place between October 2022 and July 2025, during which the pair is accused of shipping Nvidia products, including PNY-branded RTX 4090 gaming graphics cards and H100 GPUs, to Malaysia in December 2024. The shipment reportedly contained 117 Graphic Cards worth $176,500 and two Graphical Processing Unit Base Boards valued at $4,000.
According to the complaint, neither Geng nor Yang applied for a license to export these products to China. Instead, the shipment was labeled under a different export code, EAR99, which covers low-technology consumer goods and typically does not require a license in most situations.
The U.S. has prohibited exports of RTX 4090 and other high-end Nvidia GPUs to China to impede the Chinese government’s efforts to acquire advanced chips for its AI advancements. The 33-page criminal complaint further reveals that law enforcement recently searched ALX Solutions’ office, seizing Geng and Yang’s phones, which reportedly show evidence of their scheme to ship export-controlled chips to China via Malaysia in order to evade U.S. export laws.
An Excel file found in Yang’s Google Drive account also mentions shipments containing Gigabyte 4090, TUF 4090, and MSI 4090. The complaint adds that the other seven shipments list the items as ‘4090’ and ‘5090.’
The case sheds light on the ongoing GPU smuggling trade. Financial Times estimates that at least $1 billion in Nvidia AI chips were shipped to China this year, despite the Trump administration’s efforts to prevent such exports.
Geng and Yang are believed to have secured the H100 GPUs from Super Micro, a U.S. server provider. The complaint reveals that one invoice shows ALX Solutions paid $28 million for the GPUs, with Super Micro believing the shipment was destined for a company in Singapore. However, federal investigators claim that company did not exist. The suspects also sourced some GPUs from MiTAC Computing, another server provider.
The complaint adds that ALX Solutions received wire funds from various Hong Kong and Chinese companies, which were likely acting as intermediaries. Seized Google records also show instances of Chinese companies contacting ALX about purchasing Nvidia GPUs.
In response to the arrests, the Justice Department announced potential measures such as installing a location-tracking system on Nvidia’s AI chips to prevent smuggling to China. However, Nvidia has expressed concerns about this proposal, suggesting it would amount to installing a backdoor into the GPUs.
In response to these developments, Nvidia stated: “This case underscores that smuggling is not an option. We primarily sell our products to well-known partners, including OEMs (original equipment manufacturers), who assist us in ensuring all sales comply with U.S. export control rules. Even relatively small exporters and shipments are subject to thorough review and scrutiny, and any diverted products would have no service, support, or updates.”
