Another day, another situation in which the Chinese are stealing from the United States.
Allegedly anyway.
According to the Department of Justice (DOJ), two Chinese nationals have been arrested for “knowingly” exporting “tens of millions of dollars’ worth of sensitive microchips used in artificial intelligence (AI) applications” to China. They’re charged with violating the Export Control Reform Act and face up to 20 years in prison if convicted.
Twenty-eight-year-old Chuan Geng lives in Pasadena, Calif., and is a lawful permanent resident of the United States. Shiwei Yang, who is also 28 years old, lives in El Monte and is in the country illegally — she initially had a visa but stayed beyond its expiration. The DOJ says that Yang was arrested on Saturday, and Geng eventually surrendered to federal authorities this weekend.
On Monday, they appeared before a federal magistrate judge in a Los Angeles U.S. District Court. Geng was released on $250,000 bond. Yang is still behind bars. They face arraignment on Sept. 11.
Two Chinese Nationals Arrested on Complaint Alleging they Illegally Shipped to China Sensitive Microchips Used in AI Applications
— National Security Division, U.S. Dept of Justice (@DOJNatSec) August 5, 2025
The two were apparently using their business, which is also based in El Monte, Calif., ALX Solutions Inc., to smuggle the high-powered Nvidia AI chips to Beijing. Records suggest that between October 2022 and July 2025, the pair:
Knowingly and willfully exported from the United States to China sensitive technology, including graphic processing units (GPUs) – specialized computer parts used for modern computing – without first obtaining the required license or authorization from the U.S. Department of Commerce. According to the complaint, ALX Solutions Inc. was founded shortly after the Commerce Department began requiring licenses for the advanced microchips that Yang and Geng are alleged to have illegally exported.
A review of export records, business records, and company websites indicates that a December 2024 shipment and at least 20 previous shipments by ALX Solutions involved exports from the U.S. to shipping and freight-forwarding companies in Singapore and Malaysia, which commonly are used as transshipment points to conceal illegal shipments to China.
They were receiving payments from companies based in China and Hong Kong rather than the ones to which they claimed they were exporting the goods. They were making a lot of money on it, too. One January 2024 payment alone was worth $1 million. It came from a China-based company.
The complaint filed suggests that the product is the “most powerful GPU chip on the market,” designed for various applications like self-driving cars and important medical diagnosis systems.
The DOJ reports that law enforcement has searched the company’s offices and seized phones related to the operation. The phones “revealed incriminating communications between the defendants, including communications about shipping export-controlled chips to China through Malaysia to evade U.S. export laws.”
The U.S. Department of Commerce’s Bureau of Industry and Security and the FBI are still investigating the operation.
China’s theft of these chips is nothing new. Despite the fact that the Donald Trump administration has been cracking down on China’s ability to get its hands on these chips since May, the Financial Times reported last month that at least $1 billion in Nvidia computer chips were smuggled into China between May and July.
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