Key facts
- Taiwan has indicted nine people, including an Nvidia senior manager and Supermicro employees, for allegedly forging documents.
- The suspects are accused of illegally exporting high-end AI servers to China, violating US export controls.
- The scheme involved falsifying documents to make it appear that servers were installed in Taiwan.
- 74 servers were exported to China, while 56 were blocked by Taiwanese customs officials.
- Nvidia CEO Jensen Huang previously criticized Supermicro's compliance program regarding exports to China.
- US lawmakers are considering legislation to extend export controls to remote cloud-based access to hardware and software.
Taiwan has indicted nine individuals, including an Nvidia senior manager and two Supermicro employees based in the country, for allegedly forging documents to cover up illegal exports of high-end AI servers to China. The scheme, which reportedly began in 2022, aimed to circumvent US export controls designed to protect national security and maintain a lead in the AI race.
Prosecutors in Keelung confirmed the charges of breach of trust and document forgery. One suspect linked to a related case is still at large, accused of siphoning funds from a distributor company involved in facilitating China's access to restricted Nvidia chips. The investigation found that co-conspirators attempted to falsify documents to make it appear that 130 B300 servers were installed at a Taiwan facility. However, 74 of these servers were ultimately exported to China, while 56 were intercepted by Taiwanese customs officials due to detected irregularities.
Nvidia CEO Jensen Huang had previously expressed criticism of Supermicro's compliance program, urging improvements to prevent such incidents. Supermicro has confirmed its cooperation with Taiwanese authorities and stated it is not a target of the probe, though it has fired employees connected to the scheme. An expert noted that a Southeast Asian firm was allegedly at the heart of the operation, coordinating with co-conspirators at Supermicro and Nvidia.
US lawmakers are considering the Remote Access Security Act (RASA), which would extend export controls to remote cloud-based access to critical hardware and software. This legislation aims to close a loophole that allows China to access Nvidia chips via data centers in Southeast Asia, which is crucial for the development of Chinese AI models. The scandal highlights the challenges in enforcing export controls, as billions of dollars worth of hardware were allegedly diverted through forged documents and a potentially overburdened system.