Two Chinese nationals have been arrested in California on charges of illegally exporting tens of millions of dollars’ worth of advanced Nvidia AI chips to China, allegedly violating US export controls, the US Department of Justice (DOJ) announced Tuesday.
The accused, Chuan Geng, 28, of Pasadena, and Shiwei Yang, 28, of El Monte, are charged under the Export Control Reform Act. If convicted, they could each face up to 20 years in prison.
Prosecutors allege the pair used a company they founded, ALX Solutions Inc., based in El Monte, to unlawfully export high-performance graphics processing units (GPUs), including Nvidia’s H100 AI accelerators.
These chips are among the most powerful available and are critical for training and operating artificial intelligence systems.
Under current US export laws, their sale to certain countries—most notably China—requires a license from the Commerce Department, which is rarely granted.
According to a criminal complaint, ALX Solutions shipped the restricted chips to third countries, including Singapore and Malaysia, in an effort to bypass US export restrictions.
Although shipments were directed to freight-forwarding companies in those countries, the DOJ said ALX received no payments from them. Instead, payments were funneled in from companies based in Hong Kong and mainland China, including a $1 million transfer in January 2024.
Investigators said a shipment made in December 2024 was falsely declared as compliant with export rules, despite ALX and its founders not possessing the required licenses.
Authorities also uncovered communications indicating that the defendants were aware of the restrictions and had coordinated efforts to move chips through Malaysia into China.
A search of ALX Solutions’ office and the suspects’ devices reportedly revealed further evidence of illegal activity.
Yang was also found to have overstayed her visa, while Geng holds legal permanent residency in the US
A judge in Los Angeles on Monday ordered Geng released on a $250,000 bond. A detention hearing for Yang is scheduled for August 12. No pleas have been entered at this stage of the case.
In a statement, Nvidia said it sells its products primarily through established partners and emphasized its commitment to complying with US export control laws.
“Smuggling is a nonstarter,” the company said, adding that diverted products are not eligible for service, support, or updates.
The arrests come amid intensifying US efforts to prevent China from acquiring cutting-edge semiconductor technology that could advance its AI capabilities.
The Commerce Department’s Bureau of Industry and Security, along with the FBI, is actively involved in the investigation.
Earlier, four Chinese nationals were arrested in Greece for photographing French-made Rafale fighter jets and filming sensitive areas around the Hellenic Aerospace Industry (HAI) and the 114th Combat Wing.
Among those arrested were a woman, two men and a younger individual, all of whom are in police custody, as per reports.
The Hellenic Air Force Police swiftly intervened and detained the group after they ignored repeated warnings. The accused were handed over to local authorities in Tanagra, located northeast of Athens.
