A federal indictment unsealed in Manhattan has charged three individuals associated with server manufacturer Super Micro Computer Inc. (Supermicro) with conspiring to illegally export advanced AI servers equipped with Nvidia graphics processing units (GPUs) to China.
The Alleged Scheme
According to the indictment from the U.S. Attorney's Office for the Southern District of New York, the defendants are accused of orchestrating a scheme to use a company based in Southeast Asia as a front to purchase approximately $2.5 billion worth of Supermicro servers. The servers were assembled in the United States and contained Nvidia GPUs, including advanced models such as the H200 and B200.
Prosecutors allege the scheme involved the following steps:
- The Southeast Asian company placed purchase orders for the servers, submitting false documentation stating the equipment was for its own operations.
- Servers were shipped from the U.S. to Supermicro's facilities in Taiwan, and then to a different location for the Southeast Asian company.
- The defendants and executives of the Southeast Asian company are alleged to have transferred the servers to a separate shipping company.
- This shipping company allegedly removed identifying packaging from the servers, placed them in unmarked boxes, and sent them to China.
- To avoid detection by Supermicro's compliance team, the defendants and others allegedly fabricated documents and communications to present the Southeast Asian company as the legitimate end-user.
Court documents state that between late April and mid-May 2025, approximately $510 million worth of servers were allegedly shipped to China through this arrangement.
The indictment further alleges that thousands of "dummy" servers were staged at a warehouse to deceive auditors from the U.S. Department of Commerce. The defendants are also accused of using encrypted messaging applications to coordinate shipments and discuss methods to avoid detection.
Individuals Charged
The indictment names the following three individuals:
- Yih-Shyan “Wally” Liaw (71): A co-founder of Supermicro, a member of its board of directors, and Senior Vice President of Business Development. Liaw is a U.S. citizen and was arrested on Thursday.
- Ruei-Tsang “Steven” Chang: A sales manager for Supermicro in Taiwan. Chang is a Taiwanese citizen and is currently a fugitive.
- Ting-Wei “Willy” Sun: A third-party contractor for Supermicro. Sun is a Taiwanese citizen and was taken into custody.
Each defendant faces charges of conspiracy to violate the Export Control Reform Act (maximum 20 years in prison), conspiracy to smuggle goods (maximum 5 years), and conspiracy to defraud the United States (maximum 5 years).
Company and Official Responses
Super Micro Computer, Inc.
Supermicro has stated that it is not a defendant in the indictment. The company confirmed it has placed Liaw and Chang on administrative leave and terminated its contractor relationship with Sun. Supermicro has said it is cooperating with the government investigation and described the alleged actions as a violation of its policies and compliance controls. The company has affirmed its commitment to adhering to all applicable U.S. export regulations.
Nvidia
Nvidia has stated that strict compliance with trade laws is a top priority and that it works with customers and the government on compliance programs. The company has said it provides no service or support for systems that are unlawfully diverted.
U.S. Attorney's Office
Jay Clayton, U.S. Attorney for the Southern District of New York, stated that the alleged scheme posed a direct threat to U.S. national security.
Export Control Background
The export controls involved in this case were implemented by the U.S. Department of Commerce’s Bureau of Industry and Security in October 2022. These regulations restrict the sale of advanced AI accelerators and related computing hardware to China, designating them as strategic national security assets. Specific Nvidia GPUs, including the H100, H200, and B200 series, require a government license for export to China.
Supermicro's Corporate History
Supermicro has faced previous regulatory and compliance challenges:
- In 2018, the company’s stock was suspended from trading on the Nasdaq following an SEC investigation into accounting practices.
- In 2020, the company paid a $17.5 million penalty to settle related charges.
- In August 2024, a report from short-seller Hindenburg Research alleged accounting irregularities, which Supermicro denied.
- In October 2024, the company’s auditor, Ernst & Young (EY), resigned, stating it could no longer rely on management's representations.
- A special committee subsequently cleared the company of fraud but recommended replacing the Chief Financial Officer. The CFO, David Weigand, remains in his position.
- Liaw resigned from his positions in 2018 following an internal audit but returned as an advisor in 2021 and to a full-time executive role in 2022, rejoining the board in 2023.