The story of the Nvidia chips that flooded the Chinese market generated quite a few news briefs in 2025. Several far-fetched theories explained the illegal import channels. However, it appears that one of these channels was much more organized, operated on an industrial scale, and involved—at the very least “without its full knowledge”—a major player in the server and AI industry.
The Super Micro co-founder behind the scheme
The information confirmed today by the U.S. National Security Division sheds particular light on these operations and thus plunges Super Micro into turmoil. Indeed, three men linked to Super Micro Computer, including co-founder Wally Liaw, are accused of setting up a sophisticated covert network to smuggle embargoed equipment into China. We’re talking about at least $2.5 billion worth of server technology subject to U.S. government export restrictions. The three defendants are Wally Liaw, Steven Chang, and contractor Willy Sun.
Super Micro in Turmoil
The method is relatively simple: the team at Super Micro allegedly circumvented these restrictions by concealing the machines’ true destination. Super Micro servers were assembled in the United States and shipped via the company’s facilities in Taiwan. A route passing through several Asian countries then served to cover their tracks, ultimately allowing a company to refurbish these servers and ship them to China. This scheme may seem almost trivial, but what is shocking is the high level of sophistication and the quasi-industrial scale of the operation. The entire operation relied on the creation of fake documents, counterfeit hardware to pass inspections, and the alteration of the serial numbers on Nvidia chips.
Prosecutors indicate that the scheme generated approximately $2.5 billion in revenue between 2024 and 2025, including about $510 million in sales over a three-week period in 2025. Since the official announcement, Super Micro’s stock price has been in free fall.
