When you purchase through links on our site, we may earn an affiliate commission. Here’s how it works .
Supermicro's alleged violations of U.S. export controls that ended up as shipments of restricted Nvidia AI accelerators to China and Russia have caught a lot of attention in recent years, as billions of dollars worth of hardware were shipped to American foes. The new Bloomberg report claims that Thailand-based Obon Corp. is the previously unnamed Southeast Asian intermediary referenced in the indictment, which claims that some of the hardware ultimately reached Alibaba.
The intermediary described in court documents as 'Company-1' was allegedly Obon, a Bangkok-based company connected to Thailand's sovereign AI initiatives, according to Bloomberg . The new firm further states that some of the systems sold through OBON may have gone to Alibaba, although the Chinese technology giant denied any involvement and said it had never deployed prohibited Nvidia hardware in its data centers.
Chinese Nvidia Cloud Partner procured 300 servers with banned AI GPUs worth $92 million
Supermicro employees accused of smuggling $2.5 billion worth of Nvidia hardware to China
The Super Micro AI accelerator smuggling scandal proves how cut-throat the global AI race has become — as global trade evolves, so does export control evasion
The report notes that the servers reportedly included Nvidia H200-based systems, which fall under U.S. export restrictions intended to prevent China from obtaining top-tier AI compute hardware without government approval. By now, H200 has been approved for exports to China, though it has not reported selling them to China officially.
The original indictment accused Supermicro co-founder Yih-Shyan 'Wally' Liaw, Supermicro Taiwan sales manager Ruei-Tsang 'Steven' Chang, and third-party broker Ting-Wei 'Willy' Sun of organizing a large-scale diversion network that rerouted Nvidia Hopper-based AI servers. Prosecutors alleged that the group used a Southeast Asian front company, falsified documentation, and maintained inventories of dummy servers to conceal actual shipments of systems containing advanced Nvidia GPUs into China.
The alleged perpetrators used hair dryers to transfer serial-number labels from legitimate servers onto empty chassis to deceive inspectors and install the restricted hardware afterward, according to the allegations. The U.S. authorities estimate that the operation generated roughly $2.5 billion in sales beginning in 2024. Liaw and Sun were arrested, while Chang continues running for his life.
In general, the case raises concerns about the effectiveness of export-control enforcement across Southeast Asia. Nonetheless, as long as a market like China exists, the supply will always be there.
Get Tom's Hardware's best news and in-depth reviews, straight to your inbox.
Key considerations
- Investor positioning can change fast
- Volatility remains possible near catalysts
- Macro rates and liquidity can dominate flows
Reference reading
- https://www.tomshardware.com/tech-industry/artificial-intelligence/SPONSORED_LINK_URL
- https://www.tomshardware.com/tech-industry/artificial-intelligence/supermicro-tied-execs-used-thailand-government-entity-to-ship-nvidia-ai-gpus-to-china-report-alleges-chinese-web-giant-alibaba-received-restricted-servers#main
- https://www.tomshardware.com
- PCIe 8.0 spec hits 1 TB/s of bandwidth and has new connector technology — spec hits 0.5V milestone, final ratification expected in 2028
- Maryland citizens slapped with $2 billion power grid upgrade bill for out-of-state AI data centers — state complains to federal energy regulators, says addition
- Save $444 on this top-tier gaming PC combo with Asus Prime RTX 5070, Ryzen 9850X3D, X870E motherboard, and 32GB of RAM — world's fastest gaming CPU meets copiou
- Apple reportedly strikes deal for Intel to make some of its chips — two tech giants reached a preliminary agreement for Intel to make processors for Cupertino
- Motherboard sales 'collapse' by more than 25% as chipmakers strangle enthusiast PC market to build more AI chips — Asus projected to sell 5 million fewer boards
Informational only. No financial advice. Do your own research.