Charges Filed Against Super Microcomputer Executives
Federal prosecutors have charged three individuals connected to Super Microcomputer, including its co-founder, for allegedly rerouting billions in Nvidia-powered AI servers to China, violating U.S. export laws.
The indictment was filed by the U.S. Attorney’s Office for the Southern District of New York against Yishan “Wally” Liau, Rui Tsang “Stephen” Zhang, and Tingwei “Willy” Sun under the Export Control Reform Act. They are accused of smuggling advanced AI technology, including Nvidia chips, into China despite stringent export safeguards meant to protect U.S. national security.
Liau holds a prominent position at Super Microcomputer, serving as a board member and senior vice president of business development, with control over about $464 million in Super Micro stocks. Zhang was a sales manager in Taiwan, while Sun worked as a contractor for the firm. Supermicro confirmed these roles after the indictment announcement.
The charges led to a significant drop in Supermicro’s stock, which fell over 27% in early trading. Although the company itself is not named as a defendant, it stated that it has placed some employees on leave and severed ties with contractors.
Prosecutors allege that the defendants devised a complex scheme involving Southeast Asian firms as intermediaries. These intermediaries reportedly produced fake documents to suggest the servers remained in Southeast Asia, while another logistics entity disguised the true destination of the equipment before sending it to China.
According to the indictment, “dummy” servers were kept in the company’s storage facilities in Southeast Asia to deceive compliance teams about the whereabouts of the actual servers, which were already shipped to China. Moreover, these dummy servers were ostensibly used during visits by U.S. export control officials to pressure compliance teams into approving shipments.
Federal prosecutors estimate that these operations have generated around $2.5 billion in sales for Supermicro since 2024. From late April to mid-May 2025, servers valued at $510 million were sold to Southeast Asian companies and subsequently sent to China. Supermicro, reportedly, lacked the necessary license from the U.S. Department of Commerce to export servers with Nvidia processors to China.
The indictment claims that Zhang attempted to obstruct audits by preventing inspection of areas where the servers were kept, allegedly hiring a “friendly” auditor for a compliance review. This raised eyebrows given Supermicro’s announcement of a change in auditors in 2024.
Text messages included in the indictment reveal that Liau urged Southeast Asian companies to order more advanced chips, specifically pushing for Nvidia’s B200 chips based on their new Blackwell architecture late in 2024. In one instance, Liau inquired about volume forecasts, explaining that this information was essential for securing allocations from Nvidia.
In 2025, he reportedly sent a link to a White House statement about fresh export restrictions, implying that the pace of shipments needed to hasten before these rules took effect. When notified about a Chinese individual’s arrest for smuggling AI chips, his response included a sobbing emoji.
This situation highlights ongoing concerns regarding the unauthorized access of advanced AI chips to China, particularly as U.S. AI companies face competition from Chinese entities like DeepSeek. Nvidia GPUs are in high demand globally for developing generative AI models.
Export control regulations have undergone significant shifts since the Trump administration. Initially aiming to curb China’s access to advanced processors, Trump later announced allowances for Nvidia to ship certain GPUs to China under specific security measures. Recently, Nvidia CEO Jensen Huang indicated that the company is resuming manufacturing to fulfill orders for H200 chips destined for China.
Jay Clayton, a federal attorney emphasizing the severity of the charges, remarked, “Crimes involving sensitive technology must be met with swift action, or the law is meaningless.”
Liau and Sun were arrested on Thursday, while Zhang remains at large. Supermicro asserted it has a strong compliance program, committed to adhering to all U.S. export control regulations, and contended that the alleged actions were contrary to its policies.
