Super Micro-linked executives charged in $2.5 billion Nvidia AI server smuggling scheme
U.S. prosecutors charged three people tied to Super Micro, including co-founder Yih-Shyan "Wally" Liaw, in an alleged scheme to divert Nvidia-powered AI servers to China in violation of U.S. export controls. Authorities said the group used a Southeast Asian front company, falsified shipping paperwork, and thousands of dummy server shells to conceal the movement of restricted hardware, with one method allegedly involving a hairdryer to transfer serial numbers from legitimate systems to decoy units. The Justice Department said the operation generated about $2.5 billion in sales since 2024; Liaw and Ting-Wei "Willy" Sun were arrested, while Ruei-Tsang "Steven" Chang remains a fugitive.
Super Micro said it was not named as a defendant, placed Liaw and Chang on administrative leave, and cut ties with the contractor involved, while Nvidia said it supports strict export-control compliance and does not back unlawfully diverted systems. The allegations focus on misuse of Super Micro’s server supply chain, widely used to house Nvidia GPUs in data centers, and the market reacted sharply: Super Micro shares fell 25.3% in premarket trading, wiping out roughly $4.7 billion in market value. The defendants face federal felony charges that could bring prison terms, fines, asset forfeiture, and bans on working in export-controlled industries.
Timeline
Apr 11, 2026
Report says Sharetronic sold nearly 300 Nvidia-capable AI servers in China
A report citing invoice records said Sharetronic Data Technology Co. procured and sold 276 Super Micro SYS-821GE-TNHR servers and 32 Dell PowerEdge XE9680 servers in 2025 for about $92 million to a Shenzhen subsidiary. The server models were described as compatible with export-restricted Nvidia accelerators such as H100 and H200, suggesting additional possible leakage of controlled AI hardware into China, though the records did not definitively prove a violation.
Apr 3, 2026
Liaw and Sun plead not guilty in Nvidia server smuggling case
Super Micro co-founder Yih-Shyan "Wally" Liaw and co-defendant Ting-Wei "Willy" Sun pleaded not guilty in Manhattan federal court to charges tied to the alleged diversion of Nvidia-powered AI servers to China. The court appearance marked a new stage in the criminal case following their earlier arrests and indictment.
Mar 27, 2026
Report says four Chinese universities obtained restricted Super Micro AI servers
A report citing procurement records said four Chinese universities acquired Super Micro high-performance servers containing export-restricted Nvidia processors, including Beihang University and Harbin Institute of Technology. Two of the institutions were described as linked to PLA research programs, adding evidence of possible enforcement and supply-chain monitoring gaps.
Mar 26, 2026
U.S. senators urge halt to Nvidia AI chip exports after smuggling scandal
Senators Jim Banks and Elizabeth Warren sent a letter to Commerce Secretary Howard Lutnick urging an immediate pause or reconsideration of export licenses for advanced Nvidia AI chips and server systems bound for China and intermediary Southeast Asian countries. The request followed the Super Micro-linked smuggling revelations and raised concerns that Nvidia's statements about supply-chain monitoring may have been misleading.
Mar 26, 2026
Super Micro shareholders file securities-fraud lawsuit
Super Micro investors sued the company, alleging it concealed dependence on illegal China sales and export-control compliance problems that inflated its stock price. The civil suit followed the criminal smuggling charges and argues the subsequent disclosures caused major shareholder losses.
Mar 26, 2026
U.S. charges three men in separate AI server smuggling attempt
The Justice Department indicted Stanley Yi Zheng, Matthew Kelly, and Tommy Shad English for allegedly conspiring to export more than 1,000 AI servers worth over $170 million to China using false paperwork claiming a Thailand-based end user. Prosecutors said the U.S. manufacturer stopped the transactions after compliance concerns, and cited chat messages discussing how to avoid scrutiny over embargo violations.
Mar 25, 2026
Super Micro removes Liaw from board and names acting compliance chief
Following the smuggling charges, Super Micro removed co-founder Yih-Shyan "Wally" Liaw from its board and appointed DeAnna Luna as acting chief compliance officer. The move marked an additional governance and compliance response beyond the company's earlier leave and contractor actions.
Mar 25, 2026
Zheng arrested; Kelly and English surrender in AI server smuggling case
In the separate AI server smuggling case, the FBI arrested Stanley Yi Zheng on March 22, 2026, while Matthew Kelly and Tommy Shad English surrendered on March 25, 2026. The arrests followed charges that the three men tried to obtain and export restricted AI servers to China through fraudulent Thailand-based purchase orders.
Mar 24, 2026
News of charges sends Super Micro shares sharply lower
Following public reporting on the case, Super Micro stock fell 25.3% in premarket trading, wiping out roughly $4.7 billion in market value. The market reaction reflected investor concern over the alleged abuse of the company's server supply chain.
Mar 20, 2026
Super Micro places two employees on leave and cuts contractor ties
After the charges were announced, Super Micro said it was not named as a defendant, placed two employees on administrative leave, and terminated its relationship with the contractor involved. Nvidia separately said it prioritizes strict compliance and does not support unlawfully diverted systems.
Mar 20, 2026
Liaw and Sun arrested; Chang remains a fugitive
According to the Justice Department, Yih-Shyan Liaw and Ting-Wei Sun were arrested in connection with the case, while Ruei-Tsang Chang remained at large. The defendants face federal felony charges that could bring prison time, fines, forfeiture, and export-industry employment bans.
Mar 20, 2026
U.S. charges three people in alleged AI hardware smuggling case
U.S. authorities charged three individuals associated with Super Micro over an alleged scheme to smuggle Nvidia AI hardware to China in violation of export controls. The indictment says the defendants used methods including transferring serial numbers between real hardware and dummy servers to disguise shipments.
Jan 1, 2024
Alleged Nvidia AI server diversion scheme begins
Federal prosecutors allege that Yih-Shyan "Wally" Liaw, Ruei-Tsang "Steven" Chang, and Ting-Wei "Willy" Sun began unlawfully diverting Nvidia-powered AI servers to China in 2024 using a Southeast Asian front company, falsified paperwork, and dummy server shells. The alleged scheme is said to have generated about $2.5 billion in sales while evading U.S. export controls.
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