California man Greg Lui arrested for smuggling $300m in Nvidia AI servers to China

What happened?

US federal authorities have arrested a California man accused of smuggling more than $300 million worth of restricted computer servers, packed with advanced Nvidia artificial intelligence chips, to China.

Greg Lui, 38, allegedly ran a sophisticated scheme to bypass US export controls by routing the high-end hardware through Southeast Asia, according to a Department of Justice statement.

Lui, who also goes by "Yiu Kong Lui", operated a technology firm called Earthmade Computer. Prosecutors say that between 2023 and 2024, Lui used the company to buy export-controlled servers containing US-manufactured graphics processing units (GPUs). Because direct shipments of these chips to China are banned, he allegedly used false paperwork to send them to Malaysia and Singapore first. Since those countries did not require export licences for the hardware, the shipments went through unchallenged before being illegally re-exported to Chinese buyers.

Why the hardware is restricted

The high-performance GPUs contained in the servers are the lifeblood of modern artificial intelligence. They are heavily restricted by the US Department of Commerce to prevent China from using American technology to accelerate its own AI and military development.

In its official statements, the Justice Department noted that the seized hardware contained chips "commonly used for Super Intelligence," using the Trump administration's preferred term for advanced AI.

"Protecting America’s national security means keeping our advanced super intelligence technology from being used to strengthen our adversaries’ military capabilities," said Bill Essayli, the US Attorney for the Central District of California. "We will aggressively prosecute those who put our national security at risk for profit."

What happens next?

If convicted on the federal smuggling and export control charges, Lui faces a maximum of 50 years in prison.

The case highlights the growing challenges US regulators face in policing the global semiconductor supply chain. Despite strict rules blocking top-tier Nvidia chips from entering China, a lucrative black market has emerged, with front companies and transshipment hubs in Southeast Asia frequently used to mask the final destination of restricted tech. While the US has steadily tightened its restrictions, Chinese firms have remained desperate to acquire the processing power needed to keep pace with American AI development.