Keelung District Prosecutors Office in Taiwan has indicted 9 people in a case involving the illegal export of AI systems powered by Nvidia B300 GPUs to China, revealing a 5-step plan designed to bypass export controls.
According to the indictment, Flying Tiger Tech became an approved customer and ordered 130 B300 systems, declaring they would be used in Taiwan.
The order was placed through Albatron Technology, an official Supermicro distributor, which helped reduce the level of scrutiny regarding the customer’s financial background.
To pass on-site inspection requirements, Flying Tiger provided a quotation for renting a Chief Telecom data center instead of an official lease agreement.
The inspection team confirmed the operational location, but the facility actually lacked the racks, power, and bandwidth required to operate 130 AI systems as registered.
Prosecutors alleged that several internal personnel assisted in the process, including an Nvidia Taiwan sales manager who pushed for credit limit approval, a Supermicro manager who instructed the company on how to bypass the inspection process, and another manager who knew the true destination of the equipment yet aided the scheme to earn commissions.
Supermicro subsequently approved the delivery of 130 systems in three batches of 2, 64, and 64 units.
Out of the first 74 systems, 16 were shipped directly to China, 50 went through Indonesia before reaching China, and 8 were routed through Japan and then Hong Kong before entering China.
Profits from these shipments were estimated to reach about $21.21 million.
The scheme was uncovered when 56 systems declared for export to Japan were requested by the customer to provide a high-tech goods export license. The defendants were accused of submitting forged documents, including edited images from Supermicro’s website.
The investigation also uncovered another fraud involving a fake installation invoice worth 39 million New Taiwan Dollars (approximately $1.32 million), with the parties allegedly splitting the funds.
Some suspects turned themselves in and cooperated with investigators for potential leniency, but still face up to 5 years in prison for export regulation violations and 6 years in prison for property fraud charges.
📌 The case shows that AI chip export controls are increasingly sophisticated, but they also face evasion networks aided by multiple links in the supply chain. The accused ring used intermediary companies, forged documents, and transshipment hubs such as Indonesia, Japan, and Hong Kong to smuggle Nvidia B300 systems into China. The investigation also highlights the critical role of internal controls and supply chain monitoring in enforcing high-tech export regulations.
