Super Micro Co-Founder and Associates Face Charges in $2.5B Chip Smuggling Scandal
On March 19, 2026, Super Micro Computer’s co-founder and two of his associates were charged with the illegal smuggling of $2.5 billion worth of Nvidia AI chip-powered servers to China. This action was in direct violation of U.S. export control laws and resulted in a 33 percent plummet in the company’s stock value.
The U.S. Attorney’s Office for the Southern District of New York brought charges against Yih-Shyan ‘Wally’ Liaw, Super Micro’s co-founder and senior vice president of business development, sales manager Ruei-Tsang ‘Steven’ Chang, and contractor Ting-Wei ‘Willy’ Sun. Liaw and Sun were apprehended on the day of the charges, while Chang remains at large.
The indictment detailed a scheme that involved a Southeast Asian company acting as a middleman to place purchase orders, effectively concealing the servers’ true destination. The defendants are accused of creating falsified paperwork, using ‘dummy’ non-working servers to deceive compliance auditors, and repackaging real servers into unmarked boxes for shipment to China. This operation is said to have generated approximately $2.5 billion in sales for Super Micro since 2024, with $510 million worth of servers shipped between April and May 2025 alone.
Super Micro, which is not named as a defendant, has placed Liaw and Chang on administrative leave and terminated its relationship with Sun. The company emphasized that the alleged conduct ‘is a contravention of the Company’s policies and compliance controls.’ Liaw subsequently resigned from the company’s board of directors on March 20.
This case represents the most high-profile enforcement action to date in the U.S. government’s efforts to prevent advanced AI technology from reaching China. Super Micro accounts for approximately 9 percent of Nvidia’s revenue and is a major assembler of AI servers. The stock crash on Friday wiped more than $6 billion from the company’s market value.
Source: CNBC