U.S. prosecutors unsealed an indictment charging three individuals tied to Supermicro with conspiring to divert high-performance AI servers from the United States to China in violation of U.S. export control laws. The U.S. Attorney’s Office for the Southern District of New York identified the defendants as Yih-Shyan “Wally” Liaw, a Supermicro co-founder, board member, and senior vice president of business development; Ruei-Tsang “Steven” Chang, a manager in Taiwan; and Ting-Wei “Willy” Sun, a contractor. Prosecutors alleged the scheme routed servers through Taiwan and Southeast Asia, then repackaged and shipped them onward to China using false documentation and concealed end-user information.
According to the indictment, the operation involved approximately $2.5 billion in server purchases between 2024 and 2025, including about $510 million in U.S.-assembled systems that prosecutors say were diverted to China between late April and mid-May 2025 alone. The Justice Department said the defendants used fabricated records, staged inspections, and thousands of “dummy” servers to mislead both internal compliance teams and U.S. authorities. Liaw and Sun were arrested in California, while Chang remains a fugitive. Each defendant faces charges including conspiracy to violate the Export Controls Reform Act, conspiracy to smuggle goods from the United States, and conspiracy to defraud the United States.
Supermicro said in a press release that it is not named as a defendant in the indictment. The company said it placed Liaw and Chang on administrative leave and terminated its relationship with Sun effective immediately. Supermicro also said the alleged conduct violated its policies and compliance controls and that it has been cooperating fully with the government’s investigation. Reuters and AP reported that the case centers on servers integrating advanced AI GPUs and comes amid continuing U.S. efforts to restrict the flow of sensitive AI computing technology to China.
• SDNY unsealed an indictment on March 19, 2026 charging three individuals tied to Supermicro
• Prosecutors alleged a scheme to divert AI servers assembled in the U.S. to China without required export licenses
• The indictment cited about $2.5 billion in server purchases tied to the scheme between 2024 and 2025
• At least $510 million worth of U.S.-assembled servers were allegedly diverted to China in a brief period from late April to mid-May 2025
• Prosecutors alleged the use of false paperwork, repackaging, encrypted messaging, and dummy servers to evade audits and inspections
• Supermicro said it is cooperating with the investigation and is not named as a defendant
• Liaw and Sun were arrested; Chang remains a fugitive
