US federal prosecutors have charged four individuals for illegally smuggling Nvidia GPUs and HP supercomputers equipped with Nvidia GPUs from the US to China. The smuggling operation circumvented US restrictions that prohibit Nvidia from selling its most powerful chips for AI training to China, a court filing revealed. Despite export controls, Chinese companies like DeepSeek have managed to develop competitive AI models, including the R1 model released earlier this year. According to Scale CEO Alexander Wang, China may possess more of Nvidia’s H100 AI chips than commonly believed, potentially facilitated by operations such as these.
According to court documents, the accused individuals are Mathew Ho, Brian Curtis Raymond, Tony Li, and Harry Chen. The group allegedly conspired to export Nvidia’s GPUs without the required licenses, shipping 50 of the high-demand H200 GPUs and multiple batches of the earlier H100 GPUs. The operation involved a purported front company named Janford Realtor, LLC, which was utilized as an intermediary for the unlawful exports to China. Ho, a US citizen, was listed as the company’s registered agent, while Li, a Chinese national, was identified as a manager.
The case sheds light on the challenges faced by tech companies dealing with sensitive technologies and the ongoing efforts to prevent unauthorized transfers. Nvidia, which recently reported record quarterly revenue of $57 billion, remains subject to US export controls on certain products, reflecting the complex landscape of international tech trade.
Source: The Verge