Nvidia Employee in Taiwan Investigated for Alleged Smuggling of AI Chips to China

The Taiwan prosecutor's office has detained a Nvidia employee as part of an investigation into the alleged illegal shipment of artificial intelligence chips to China, a source familiar with the case confirmed to AFP on Tuesday. The arrest occurred after authorities conducted searches at his home and workplace on July 24.

The Keelung District Prosecutor's Office stated in a press release that the suspect faces charges including "the forgery of commercial documents under the Penal Code," although it refrained from publicly identifying Nvidia.

The Alleged Smuggling of AI Chips

According to the source consulted by AFP, the worker was linked to the case after analyzing evidence obtained during a series of previous operations directed against Supermicro.

The investigation is related to the alleged shipment of high-end artificial intelligence servers manufactured by that company, equipped with advanced chips from Nvidia, to China, Macau, and Hong Kong, a maneuver that would violate the export controls imposed by the United States.

Taiwanese authorities had already announced in May that they were investigating these operations, in a context marked by Washington's restrictions on the sale of the most advanced AI chips to China. Nvidia, a leader in the market for artificial intelligence processors, is at the center of these trade limitations driven by the United States to restrict Chinese access to cutting-edge technology.

In this scenario, the White House intensifies the conflict with the Asian giant over the training and development of AI models. An example of this is Washington's pressure on Moonshot AI, which added a new chapter after White House officials accused the Chinese company of using U.S. technology to develop Kimi K3, the artificial intelligence model that has captured the industry's attention for its capabilities.

The director of the White House Office of Science and Technology Policy, Michael Kratsios, stated that the company "acquired servers equipped with GB300 and has accessed GB300 in Thailand, likely to train its AI models." In a social media post, he asserted that Moonshot would have violated U.S. export controls and the terms of service of various companies to develop its system.

The servers mentioned by Kratsios incorporate Nvidia's Blackwell chips, a generation of processors whose sale to Chinese companies remains prohibited by Washington. While the Trump administration authorized some exports of H200 chips, it maintains restrictions on Blackwell models, which are considered more advanced.

The suspicions are supported by a memorandum released in May by the Bureau of Industry and Security (BIS), the agency responsible for overseeing export controls on artificial intelligence chips. The document confirmed that Chinese companies cannot acquire these advanced processors through subsidiaries located outside of China. In this context, U.S. officials are investigating whether some companies exploited regulatory loopholes to send these chips to subsidiaries of Chinese firms.

The accusations were also backed by Treasury Secretary Scott Bessent, who, without specifically mentioning Moonshot, warned about practices of Chinese open-source artificial intelligence companies that, he claimed, resort to intellectual property theft to develop new models: "This administration supports open-source models, but what we do not support is intellectual property theft. If we see, especially, that foreign models are stealing from our major companies, we have the ability to sanction them," he stated during an interview with Fox Business.