The owner of a San Gabriel Valley technology company was arrested Thursday after federal prosecutors charged him with smuggling more than $300 million of restricted computer hardware to China.<\/p>\n
Greg Lui, the owner of Earthmade Computer Inc. in the City of Industry, allegedly sold high-end computer servers containing U.S.-manufactured Nvidia chips to the Chinese government, while claiming they were meant for customers in Malaysia and Singapore, according to the federal indictment filed this week. <\/p>\n
The U.S. Commerce Department doesn\u2019t require an export license to ship this type of hardware to those two countries, but does for shipments to China.<\/p>\n
\u201cProtecting America\u2019s national security means keeping our advanced Super Intelligence technology from being used to strengthen our adversaries\u2019 military capabilities,\u201d First Assistant U.S. Atty. Bill Essayli said in a Justice Department news release<\/a>. \u201cWe will aggressively prosecute those who put our national security at risk for profit.\u201d<\/p>\n President Trump signed an executive order<\/a> this week rebranding \u201cartificial intelligence\u201d technology as \u201csuper intelligence\u201d amid backlash and doomsday warnings about the rapidly developing tech \u2014 including from some AI executives<\/a>.<\/p>\n Lui has been charged with one count of conspiracy to violate export controls, one count of outbound smuggling and one count of conspiracy to commit money laundering. An attorney representing him has not yet been listed in available court documents, and The Times was unable to reach Lui for comment.<\/p>\n The federal indictment, filed Tuesday in the Central District of California, comes as some lawmakers have sought to curb tech exports to China, even as AI chip companies such as Nvidia and AMD lobby against restrictions.<\/a> <\/p>\n Trump last year relaxed some export controls on advanced chips sold to China and, with his executive order this week, rebuffed calls for regulation of AI, saying it would hamper economic growth and competition.<\/p>\n The indictment alleges Lui and his co-conspirators provided false documentation to chip manufacturers that showed the items would be going to users in countries such as Malaysia and Singapore. However, prosecutors say, Lui used freight-forwarding companies to ship the high-end servers containing the microchips from Malaysia and Singapore on to China. <\/p>\n The indictment cites bank records and emails, including a purchase order to a U.S. manufacturer for 27 servers with Nvidia H100 chips for about $7.6 million. A packing list, the indictment said, showed they were shipped from the Los Angeles area to the Malaysian capital of Kuala Lumpur. But soon after, a co-conspirator of Lui\u2019s allegedly emailed a Malaysian government official saying that all 27 were shipped to China.<\/p>\n In 2024, Earthmade received more than $176 million from two Malaysia-based shipment companies as part of the scheme, prosecutors said.<\/p>\n Among the chips Lui is accused of exporting to China are the Nvidia A100 and H100. While no longer the company\u2019s most advanced chips, they are powerful enough to be used in AI applications. H100 is a somewhat newer chip released in 2022 that is optimized to handle large language models creating text, computer code, images, video and audio. <\/p>\n Demand for chips designed by Nvidia, a Santa Clara-based company, has ballooned dramatically amid the AI boom, and some lawmakers worry that access to the hardware could strengthen China\u2019s bid for technological and military dominance and weaken the U.S.\u2019s position. <\/p>\n After the U.S. placed chip-export controls on China<\/a> in 2022, Nvidia designed less-powerful versions to access the market while complying with the rules. But those reduced-capability models were later restricted too. <\/p>\n