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WASHINGTON (CN) — The Department of Justice revealed an indictment on Thursday charging a group of U.S. citizens and Chinese nationals with illegally exporting powerful Nvidia microchips used in artificial intelligence applications to the People’s Republic of China.
Federal agents in Tampa, Florida, arrested Hon Ning Ho, 34, a U.S. citizen born in Hong Kong, and Jing Chen, 45, who is in the country on a F-1 non-immigrant student visa. Two others — Brian Curtis Raymond, 46, an American running an electronics company out of Alabama, and Cham Li, 38, a Chinese national residing in California — were also arrested as part of the DOJ probe.
They remain in federal custody without bond. Public defenders for the men could not be reached for comment.
“The indictment unsealed yesterday alleges a deliberate and deceptive effort to transship controlled Nvidia GPUs to China by falsifying paperwork, creating fake contracts and misleading U.S. authorities,” said John A. Eisenberg, assistant attorney general for the National Security Division. “The National Security Division is committed to disrupting these kinds of black markets of sensitive U.S. technologies and holding accountable those who participate in this illicit trade.”
Federal prosecutors say Raymond sold the powerful Nvidia graphics processing units to the others through a Tampa-based shell company, which then shipped the microchips to Thailand and Malaysia before ultimate distribution to China. In return, the indictment alleges, they received more than $3.89 million in wire transfers from entities in China.
Since embarking on the scheme in September 2023, they successfully exported 400 Nvidia GPUs, prosecutors say. Another two shipments were “disrupted by law enforcement and therefore not completed.”
In October 2022, the Department of Commerce amended the Export Control Reform Act to restrict exports of certain technology over concerns about national security. Since then, the DOJ and Department of Homeland Security have ramped up investigations into the smuggling of cutting-edge artificial intelligence technology, specifically to China, which the U.S. accuses of using the technology for spying and weapons design.
Earlier this year, the House Select Committee on China released an investigative report on DeepSeek, a Chinese artificial intelligence platform that the committee members said grabs Americans’ user data and serves as a propaganda tool. The report claims China used more than 60,000 illegally obtained Nvidia chips to develop the AI tool.
“This report makes it clear: DeepSeek isn’t just another AI app — it’s a weapon in the Chinese Communist Party’s arsenal, designed to spy on Americans, steal our technology and subvert U.S. law," Chairman John Moolenaar, a Michigan Republican, said at the time. “We now know this tool exploited U.S. AI models and reportedly used advanced Nvidia chips that should never have ended up in CCP hands. Innovation should never be the engine of our adversaries’ ambitions.”
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