Taiwanese prosecutors have detained a person reported to be an Nvidia employee as part of an ongoing investigation into the alleged smuggling of AI servers equipped with restricted Nvidia chips into China.
The Keelung District Prosecutors' Office said investigators searched the home and workplace of a suspect identified only by the surname Chang on July 24 before questioning him. Prosecutors later sought his detention, arguing there was a risk he could flee, destroy evidence, or coordinate with others involved in the case.
The prosecutors did not identify Chang's employer. However, Bloomberg reported that he works for Nvidia and that investigators searched his desk at the company’s Taipei office.
Prosecutors said Chang is suspected of offenses including document forgery and breach of trust.
The detention marks the latest phase of an investigation that began in May and has already led to multiple arrests tied to Super Micro, whose AI servers use Nvidia chips.
Probe centers on AI server exports
Taiwanese authorities allege that documents were falsified to facilitate the export of Super Micro AI servers containing Nvidia chips subject to US export controls.
Washington has barred exports of Nvidia's most advanced AI chips to mainland China since 2022, citing concerns that the technology could support China's military and AI development. Prosecutors said the servers involved in the Taiwan investigation contained chips covered by those restrictions.
The current action is the third round of searches and detentions in the case. Earlier operations in May and June resulted in the detention of several individuals, including employees of Super Micro's Taiwan operations.
According to previous statements by prosecutors, authorities seized around 50 servers before they left Taiwan. Investigators also suspect at least one earlier shipment may have reached China through Japan before the alleged scheme was uncovered.
The Taiwan investigation follows a separate US Department of Justice case announced in March that charged three people, including Super Micro co-founder Yih-Shyan "Wally" Liaw, with allegedly helping divert Nvidia-powered AI servers to China in violation of US export controls. Super Micro has said it was not charged in that case and that the alleged conduct violated its compliance policies.
Nvidia says diverted products receive no support
Responding to the latest developments, Nvidia reiterated that it follows US export rules.
"Smuggling is a nonstarter," an Nvidia spokesperson said, according to Bloomberg. "We primarily sell our products to well-known partners, including OEMs, who help us ensure that all sales comply with US export control rules."
Nvidia also said, "Even relatively small exporters and shipments are subject to thorough review and scrutiny on both sides of the globe, and any diverted products would have no service, support, or updates."
Tightening pressure on AI supply chains
The case highlights how governments are increasing scrutiny of AI hardware supply chains as export controls become more aggressive. While Taiwan does not currently ban AI chip sales to China under its own laws, authorities have increasingly relied on domestic criminal statutes to investigate suspected diversion schemes involving restricted US technology.
For Nvidia and its server partners, the investigation underscores that compliance risks now extend beyond direct sales. Manufacturers, resellers, distributors, and employees may all face greater oversight as regulators work to close gaps that could allow advanced AI hardware to reach restricted markets.
Also read: US officials approved export licenses allowing a ZTE subsidiary and two other Chinese companies to purchase restricted Nvidia and AMD processors, though Beijing still controls whether the shipments enter China.