Export Control Gaps Exposed by $300 Million Nvidia Smuggling Case
AI-generated image · US National Wire
The arrest of Earthmade Computer CEO Greg Lui highlights systemic failures in tracking high-end compute diverted to Chinese AI labs.
The U.S. government has arrested Greg Lui, the 38-year-old CEO of Earthmade Computer, for allegedly smuggling more than $300 million in export-controlled Nvidia hardware into China. According to reporting from Ars Technica and The Register, the Department of Justice (DOJ) alleges Lui used false paperwork and freight-forwarding firms in Singapore and Malaysia to mask shipments of servers containing A100 and H100 GPUs, as well as GeForce RTX 4090 and 5090 chips.
FBI indictments detail a scheme running from October 2023 to August 2026. Lui allegedly used a fake buyer named "Jackie Lui" and purchased stolen identity documents in 2021 to facilitate the evasion of U.S. export laws. Evidence includes a 2024 order for 27 servers worth approximately $7.6 million that were claimed as Malaysia-bound but diverted to China. Another shipment of 92 servers was routed through Singapore and Malaysia to Hong Kong, eventually reaching a firm in Hangzhou, which The Wall Street Journal has identified as China's AI hub.
While a spokesperson for Nvidia told Bloomberg that diverted products represent "less than one half of one percent" of its total, a Bloomberg investigation suggests the company has "blind spots" in its compliance. U.S. officials are urging Nvidia to tighten protocols in Thailand, Malaysia, and Singapore to prevent hardware from reaching firms like DeepSeek.
John A. Eisenberg, who serves as the Assistant Attorney General for National Security, stated that protecting the chips powering "super intelligence" is critical to maintaining the American advantage. Lui faces charges including money laundering and violations of the Export Control Reform Act, with a maximum potential sentence of 50 years.