California tech executive arrested for attempting to smuggle ~$300 million in Nvidia AI accelerators to China, marking enforcement escalation of export controls.

Greg Lui, a 38-year-old technology executive from San Gabriel, California, was arrested Thursday on federal charges alleging he orchestrated the smuggling of over $300 million in export-controlled computer servers containing Nvidia artificial intelligence chips to China. Lui owns Earthmade Computer Inc., based in City of Industry, California. He faces one count of conspiracy to violate the Export Control Reform Act, one count of outbound smuggling, and one count of conspiracy to commit money laundering. Conviction on all three counts could result in sentences of up to 20 years each on the conspiracy charges and up to 10 years on the smuggling charge, according to the Justice Department.

The scheme operated between 2023 and 2024 through Earthmade, which prosecutors say purchased export-controlled servers containing Nvidia GPUs from U.S. manufacturers under false pretenses. To circumvent U.S. Commerce Department licensing requirements, Lui and unnamed co-conspirators submitted falsified documentation misrepresenting the destination of the equipment. The servers were then shipped to Malaysia and Singapore—countries that do not require licenses for such purchases—before being illegally re-exported to China. Earthmade received over $176 million from two Malaysia-based shipment companies between January and October 2024 as part of the scheme.

One indictment example involves a purchase order for 27 servers equipped with Nvidia H100 GPUs valued at approximately $7.6 million. These servers were shipped from Los Angeles to Kuala Lumpur, Malaysia, where a co-conspirator subsequently confirmed via email to a Malaysian government official that they had been transshipped to a Chinese buyer.

"This defendant allegedly used false paperwork and shipments through third countries to smuggle more than $300 million in export-controlled computer servers to China," said First Assistant U.S. Attorney Bill Essayli in a statement.

The arrest represents the latest in a series of federal enforcement actions against illegal shipments of advanced U.S. artificial intelligence chips to China. Earlier cases included an investigation into Singapore-based Apex Logistics for alleged smuggling of Nvidia chips through Southeast Asian intermediaries and charges against Super Micro Computer co-founder Yih-Shyan Liaw and two others for an alleged scheme to divert approximately $2.5 billion in Nvidia-equipped servers to China. Taiwan prosecutors also charged nine individuals, including former Nvidia and Super Micro employees, with facilitating unauthorized AI server shipments to China.

The FBI, the Commerce Department's Bureau of Industry and Security, and the Defense Criminal Investigative Service are investigating the case.