How a $2.5 Billion GPU Smuggling Ring Crashed SMCI and Nvidia (NVDA) Stocks
SMCI co-founder Wally Liaw was indicted for smuggling $2.5 billion in Nvidia AI servers to China, causing SMCI and NVDA stocks to drop.Summary
The U.S. Department of Justice unsealed an indictment charging Super Micro Computer (SMCI) co-founder Yih-Shyan “Wally” Liaw and two associates with conspiring to smuggle $2.5 billion worth of Nvidia AI servers, containing restricted GPUs like the B200 and H200 series, to China.
The alleged scheme involved using a Southeast Asian shell company as a fake end-user to place massive orders. Servers assembled in the U.S. were routed through SMCI's Taiwan facilities, then repackaged and shipped to Chinese buyers. The operation reportedly moved $510 million in just three weeks in spring 2025. To deceive inspectors during audits, the group used thousands of fake replica servers and even swapped serial numbers on real hardware.
The news caused significant market fallout, with SMCI shares plunging 28% and Nvidia (NVDA) falling 4.8%. Liaw, who holds $464 million in SMCI stock, faces up to 30 years in prison, while co-defendant Ruei-Tsang “Steven” Chang remains a fugitive. SMCI has placed both on administrative leave, stating the conduct violates company policy, and confirmed it is cooperating with authorities.
(Source：BeInCrypto)