Tech CEO 'exploited' a $300M Nvidia loophole to skirt sanctions—and the DOJ is finally moving in.

Synopsis

Greg Lui was charged by the Department of Justice for allegedly exporting restricted computer servers to China. The indictment includes conspiracy to violate export control laws and money laundering. Lui and associates misrepresented shipments through Malaysia and Singapore to bypass regulations. It is claimed that over $300 million of advanced technology was involved in the scheme. If convicted, Lui faces significant prison time for these serious offenses.

Greg Lui DOJ charges have come in attention and has become one of the most searched keywords on Google. It is due to an alleged scheme in which more than $300 million worth of export-controlled computer servers containing advanced US-made GPUs were allegedly moved toward China through Malaysia and Singapore.

Greg Lui, 38, also known as Yiu Kong Lui, is the owner of Earthmade Computer Inc., a technology company based in City of Industry, California. The US Department of Justice said he was arrested and charged in connection with the alleged export scheme. The case focuses on high-end computer servers containing graphics processing units (GPUs) used for advanced computing and Super Intelligence (SI) applications.

Greg Lui DOJ charges: What is he accused of?

According to an indictment returned on September 29, Lui faces three federal charges:

Conspiracy to violate the Export Control Reform Act and Export Administration Regulations

Outbound smuggling

Conspiracy to commit money laundering

Prosecutors alleged that Lui and his co-conspirators purchased export-controlled servers in the US and sent them toward China without obtaining the licenses required by the US Department of Commerce. Instead, the equipment was allegedly shipped first to countries including Malaysia and Singapore before being re-exported to China.

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Why were Malaysia and Singapore allegedly used?

The indictment says Lui and his associates knew that the actual end users of the servers were in China. However, prosecutors alleged they used third-country shipments to avoid the restrictions that would have applied if the equipment had been sent directly to China.

The group allegedly provided false documentation to US manufacturers. According to the indictment, the paperwork misrepresented the intended end users and destinations as permissible ones that did not require an export license. After the servers were purchased, freight forwarding companies allegedly transported them from the US to Malaysia and Singapore. Once they arrived there, Lui and his co-conspirators allegedly arranged for them to be shipped onward to China.

Nvidia GPUs and advanced US technology

The servers involved in the alleged scheme contained high-end GPUs manufactured by companies specialising in Super Intelligence computing. Nvidia is one of the major US manufacturers of advanced GPUs used for artificial intelligence, data centres and high-performance computing. The indictment says the high-end GPUs involved were subject to US export controls because such technology could make a significant contribution to the military potential of other nations.

US officials have described controlling the export of advanced computing technology as an important national security priority.

“Protecting America’s national security means keeping our advanced Super Intelligence technology from being used to strengthen our adversaries’ military capabilities,” said First Assistant U.S. Attorney Bill Essayli for the Central District of California.

The $7.6 million order that prosecutors highlighted

The indictment gives a detailed example of one alleged transaction. In January 2024, Lui allegedly received an email saying that a Malaysian transshipment company wanted to purchase 70 servers containing export-restricted GPUs. Later that month, Lui allegedly submitted a purchase order to a US manufacturer for 27 servers worth approximately $7.614 million.

The equipment was shipped from Los Angeles to Kuala Lumpur, Malaysia. The packing list identified the shipment as containing 27 servers with GPUs that were export-controlled and could not be sent to China without a license. In March 2024, a co-conspirator allegedly told a Malaysian government official that the 27 servers had actually been transshipped to a China-based buyer.

$176 million allegedly flowed through Malaysia

The alleged operation involved substantial payments as well. According to the indictment, Earthmade received more than $176 million from two Malaysia-based shipment companies between January and October 2024.

Prosecutors alleged these payments were connected to the broader scheme to move the restricted servers. The US government says Lui allegedly carried out the operation despite knowing that export regulations prohibited the shipment of certain high-end technology to China without the required authorization.

FBI says advanced technology was at stake

The FBI said the investigation found that Lui allegedly sold hundreds of millions of dollars' worth of American Super Intelligence technology to the Chinese government. “The FBI’s investigation revealed that Lui allegedly sold the Chinese government hundreds of millions of dollars’ worth of American Super Intelligence technology, in clear violation of U.S. export control laws,” said Assistant Director Roman Rozhavsky of the FBI’s Counterintelligence and Espionage Division.

“The Bureau of Industry and Security is committed to using all lawful means to protect national security and hold violators accountable,” said Assistant Secretary of Commerce for Export Enforcement David A. Peters.

The FBI, the Department of Commerce's Bureau of Industry and Security Office of Export Enforcement and the Defense Criminal Investigative Service are investigating the case.

What happens to Greg Lui now?

If convicted of all charges, Lui could face a maximum penalty of 20 years in prison on the conspiracy count, a maximum penalty of 20 years in prison on the money laundering count, and a maximum penalty of 10 years in prison on the smuggling count.

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