Taiwanese authorities have detained an Nvidia employee, identified only by his surname Chang, as part of an ongoing probe into the alleged smuggling of high-end AI servers containing Nvidia chips to China. Chang's detention follows searches of his home and workplace at Nvidia's Taipei office on July 24, with prosecutors citing concerns he might flee, destroy evidence, or collude with accomplices. He is suspected of falsifying business documents, a common charge in these cases as Taiwan does not criminalize unauthorized chip exports directly.
This marks the first known legal action against an Nvidia employee in connection with chip diversion cases. The broader investigation, which began in May, has now led to the detention of seven individuals, including two from Super Micro Computer and one from Albatron Technology. These individuals are accused of forging documents to facilitate the shipment of approximately 50 Super Micro servers to China, with some reportedly cleared by Taiwanese customs and routed via Japan.
Nvidia has stated that "smuggling is a nonstarter," emphasizing that their products are primarily sold to established partners like OEMs, who are responsible for ensuring compliance with US export controls. An Nvidia spokesperson reiterated that any diverted products would not receive service, support, or updates. The US has imposed strict restrictions on the export of advanced AI chips to China, designed to curb Beijing's technological advancements. Senator Elizabeth Warren had previously questioned Nvidia's general counsel and audit committee regarding export compliance following a March indictment related to $510 million in diverted servers from Super Micro co-founder Yih-Shyan "Wally" Liaw.
While a legal channel for exporting certain AI chips to China exists, with the US Bureau of Industry and Security reviewing H200 export licenses case by case, shipments under these licenses remain minimal. More advanced Blackwell parts are entirely prohibited, driving demand for older A100 servers on China's gray market, where they fetch prices as high as $82,000. Taiwan is also considering implementing performance-threshold controls for advanced chips, similar to those in the US, following consultations with American officials.
