Federal prosecutors have charged three individuals connected to Super Microcomputer Corp. in a significant plot to smuggle billions of dollars in U.S. artificial intelligence technology to China, using counterfeit documents, shell companies, and deceptive equipment, according to officials.
The accused allegedly channeled $2.5 billion worth of AI servers to China, including a staggering $510 million in a mere few weeks back in 2025.
Yi Xiang Liau, a 71-year-old U.S. national, and 44-year-old Ting Wei Sang from Taiwan were arrested on Thursday. Meanwhile, a third associate, Rui Tsang Chan, aged 53, also from Taiwan, remains unaccounted for.
Assistant Attorney General John A. Eisenberg commented on the unsealed indictment, highlighting the alleged attempts to evade U.S. export laws through false documents, the crafting of dummy servers to mislead inspectors, and elaborate transshipment schemes to obscure that the ultimate destination was China. He emphasized that such technology represents American ingenuity and that the National Security Division will relentlessly enforce export control laws to secure those advantages.
Supermicro indicated on Thursday that it had received notification from the U.S. Attorney’s Office for the Southern District of New York regarding the indictment of three individuals linked to the company, clarifying that Supermicro itself is not being charged.
According to the company, Liau was serving as a senior vice president and director of business development, Chan held a role as a sales manager in Taiwan, while the third individual was a contractor.
In response to the indictment, Supermicro announced that they have placed two employees on administrative leave and severed ties with a contractor involved.
Reports detailed that Liau and Chan had collaborated with brokers and clients in China, allegedly directing Southeast Asian company executives to place orders for servers from U.S. manufacturers, specifying GPUs meant for those firms.
Often, the servers were put together in the U.S., shipped to the Southeast Asian company, then repackaged in plain boxes to conceal their actual contents before being sent off to China.
The indictment asserts that the defendants generated false communication and documents to misrepresent the company as the final user of the servers. U.S. Attorney Jay Clayton accused the group of orchestrating a “coordinated scheme” to reroute servers imbued with U.S. AI technology to Chinese entities.
“They engaged in a web of deception to enhance sales and profits, all while violating U.S. law,” he remarked. “Schemes like this, if successful, risk billions in fraudulent gains and present a serious threat to U.S. national security.”
Roman Rosavsky, Deputy Director of the FBI’s counterintelligence and espionage division, emphasized the critical nature of controlling the export of sensitive U.S. AI technology for safeguarding national security.
Authorities noted that extensive efforts were undertaken to hide the alleged plot, including the installation of thousands of dummy servers—non-functional replicas of actual servers from U.S. manufacturers—to deceive compliance teams.
Surveillance footage reportedly showed the defendants prepping a dummy server in a warehouse. Before an inspection by the U.S. Department of Commerce, it was alleged that labels and serial number stickers on server boxes were removed with a hairdryer and then reapplied.
The indictment charges the defendants with conspiracy to breach the Export Control Reform Act, facing a potential maximum of 20 years in prison, along with additional charges regarding smuggling goods and conspiracy to defraud the United States, which could each result in five years behind bars.
