"The US Department of Justice has detained two men for allegedly violating export control laws by attempting to smuggle at least $160 million worth of Nvidia Corp. AI chips to China. A third, the owner of a Houston company, has already pleaded guilty. The department alleges the men operated a smuggling network that spanned the Houston business, run by Alan Hao Hsu, and several warehouses across the US, which replaced Nvidia labels from H100 and H200 AI chips with the fictional Sandkyan brand before shipping them."
"Fanyue Gong, a Chinese citizen residing in Brooklyn, New York, and Benlin Yuan, a Canadian from Ontario, are alleged to have conspired with employees of a Hong Kong-based logistics company and a China-based AI technology company to circumvent US export controls."
"Operation Gatekeeper has exposed a sophisticated smuggling network that threatens our Nation's security by funneling cutting-edge AI technology to those who would use it against American interests, US Attorney Nicholas Ganjei said in the statement. These chips are the building blocks of AI superiority and are integral to modern military applications."
Two men were detained by the US Department of Justice for allegedly attempting to smuggle at least $160 million worth of Nvidia AI chips to China. A third individual, the owner of a Houston company, has pleaded guilty. The alleged smuggling network spanned a Houston business and multiple US warehouses and replaced Nvidia H100 and H200 labels with a fictional Sandkyan brand before shipping. Two accused individuals are reported to have conspired with employees of Hong Kong-based logistics and China-based AI companies to evade export controls. The case underscores the chips' strategic value and national security concerns as Nvidia moves to Blackwell chips.
Read at www.mercurynews.com
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