Three men, including two Taiwanese nationals, were charged with allegedly smuggling $2.5 billion in sensitive AI-related computer technology to China, according to a federal indictment first unsealed on Thursday.
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“Controlling the export of sensitive U.S. artificial intelligence technology is essential to safeguarding our national security and defending the homeland. That’s why combating export violations is among the FBI’s highest priorities, and we will continue working with our law enforcement, private sector, and international partners to bring to justice all who take action to undermine U.S. national security,” said FBI’s Counterintelligence and Espionage Division Assistant Director Roman Rozhavsky.
The indictment accused Yih-Shyan “Wally” Liaw, 71, of Fremont, California; Ruei-Tsang “Steven” Chang, 53, of Taiwan; and Ting-Wei “Willy” Sun, 44, of Taiwan of conspiring to divert U.S.-built computer servers and A.I. technology to China.
Law enforcement arrested Liaw and Sun on Thursday, but Chang, who operated from Taiwan, remains at large.
“These defendants allegedly fabricated documents, staged bogus equipment to pass audit inventories, and used a pass-through company to conceal their misconduct and true clientele list. The FBI will hold accountable individuals who use American companies to provide export-controlled technology to our adversaries,” said FBI Assistant Director in Charge of the New York Field Office James C. Barnacle, Jr.
U.S. export law prevents the export of technology with potential military uses, including AI technology, to China without special permission from the U.S. Department of Commerce. All three suspects were charged with conspiring to violate the Export Controls Reform Act, conspiring to smuggle goods from the U.S., and conspiring to defraud the U.S.
According to the indictment, Liaw served as co-founder for a U.S. company that constructs high-performance computer servers for use with AI.
Chang served as general manager at the company’s office in Taiwan, while Sun was a third-party “fixer” who allegedly helped Sun and Liaw illegally divert technology to China.
The company, Super Micro Computer, was not named in the indictment, but they nevertheless issued a statement on the allegations against their co-founder.
“The conduct by these individuals alleged in the indictment is a contravention of the Company’s policies and compliance controls, including efforts to circumvent applicable export control laws and regulations. Supermicro maintains a robust compliance program and is committed to full adherence to all applicable U.S. export and re-export control laws and regulations,” they said.
According to the indictment, Liaw and Chang directed executives at an unnamed company in Southeast Asia to order servers with specific components. The servers were made in the U.S., shipped to Taiwan, then transported to the unnamed company.
That unnamed company then allegedly worked with the suspects to repackage the servers and place them in unmarked boxes, which were then sent to China.
The unnamed company allegedly falsified records to claim that they were the final recipient of the servers.
From 2024-2025, the company allegedly purchased $2.5 billion worth of servers. Between April and May 2025 alone, the indictment accused the suspects of funneling $510 million worth of servers to China using the unnamed Asian company.
The defendants reportedly went to great lengths to conceal the scheme, including by staging thousands of fake replica servers for an inspection at the unnamed company to conceal that they had been shipped to China.
Surveillance cameras allegedly recorded Sun and a third-party staging the dummy servers.
Based on the charges, each of the defendants faces a potential maximum sentence of 30 years in prison.
