US Arrests California Man Over Alleged $300 Million AI Server Smuggling to China

The US Justice Department announced the arrest on Thursday of Greg Lui, 38, also known as Yiu Kong Lui, a California resident accused of smuggling export-controlled computer servers worth roughly $300 million to China, according to reports by the South China Morning Post (SCMP) and the Guardian. The Guardian put the figure at more than $300 million; SCMP described it as about $300 million.

Prosecutors allege that the scheme relied on false documents and on shipments routed through third countries, including Malaysia and Singapore, to hide China as the true destination and to evade US export controls.

According to SCMP, Lui is from San Gabriel, California, and has been charged with conspiracy to violate US export controls, outbound smuggling and conspiracy to commit money laundering. The Guardian reported that, if convicted, he could face a maximum of 50 years in prison.

According to the Guardian, the Justice Department statement said Lui operated a technology company called Earthmade Computer, which he allegedly used to buy and send items to China between 2023 and 2024 without the required Commerce Department licenses. The company allegedly shipped goods to countries such as Malaysia and Singapore, where no such license is required, before re-exporting them to China, the Guardian reported.

The nature of the hardware is described differently in the two reports. SCMP's headline refers to Nvidia AI servers. The Justice Department statement, as quoted by the Guardian, describes the servers as containing "US-manufactured graphics processing units (GPUs) commonly used for Super Intelligence (SI)" without naming a manufacturer. The Guardian describes "Super Intelligence" as the Trump administration's new term for artificial intelligence.

What each side says

The Justice Department framed the case as enforcement of US export-control laws to protect national security. SCMP quoted Assistant Attorney General John A. Eisenberg as saying: "These chips are the product of American ingenuity" and "The National Security Division will continue to enforce our export-control laws to protect that advantage."

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

The reports reviewed by Vocemundi do not include any response from Lui, his lawyer or Earthmade Computer. They also do not describe the court where the indictment was filed, the date of any first appearance, or Lui's custody or bail status.

The reports do not identify the recipients in China, the specific GPU models involved, or how the $300 million figure was calculated. They include no comment from Nvidia, the Chinese government, or authorities in Malaysia or Singapore. Both reports draw on the same Justice Department announcement.

Analysis

The case illustrates how US authorities are pursuing alleged transshipment routes for advanced computing hardware, with Southeast Asian hubs cited as intermediate stops. If the charges proceed, the prosecution could test how US export rules apply to goods that leave the country legally before being re-exported. Possible scenarios include a trial, a plea agreement or dismissal; none can be assumed. The allegations remain unproven, and Lui's account is not yet part of the public record. Responses from Chinese, Malaysian or Singaporean authorities, or from chipmakers, could shape how the case is viewed internationally. The reliance of both reports on a single official statement limits independent verification.

Produced by the Vocemundi newsroom with AI assistance.