Two California Men Charged With Illegally Exporting AI Chips to China

Key Points

1. Chuan Geng and Shiwei Yang allegedly used their company, ALX Solutions Inc., to ship restricted GPUs to China via third-party shippers in Southeast Asia, masking the final destination.

2. The U.S. Department of Justice charged the pair with conspiring to violate the Export Control Reform Act, with Geng released on bond and Yang remaining in custody.

3. ALX Solutions was formed shortly after the U.S. began requiring licenses for certain advanced microchips exported to China, with shipments allegedly occurring from October 2022 to July of the current year.

4. Funds for the shipments reportedly came from firms in Hong Kong and mainland China, including a $1 million wire transfer from a China-based company in early 2024.

5. The U.S. restricts GPU exports to China, Russia, Iran, and North Korea due to national security concerns, as GPUs are critical for AI development.