Taiwanese prosecutors have detained a man surnamed Chang in the Nvidia Taiwan smuggling probe, accusing him of falsifying business documents tied to an AI chip diversion investigation that began in May. Bloomberg reported that Chang works for Nvidia and that investigators searched his desk at the company’s Taipei office on July 24, along with his home.
The Keelung District Prosecutors’ Office said Tuesday that Chang is strongly suspected of the offenses under investigation. Prosecutors cited concerns that he could flee, destroy evidence or coordinate testimony with witnesses. They have not accused Nvidia of wrongdoing, according to the prosecutors’ account reported by Bloomberg.
If Bloomberg’s identification is correct, the detention would be the first known legal action against an Nvidia employee in a chip diversion case. Nvidia told Tom’s Hardware that “smuggling is a nonstarter,” and said it sells mainly through established partners such as OEMs that are expected to comply with U.S. export controls. The company also said diverted products would not receive service, support or updates.
Why is Taiwan using fraud charges in an AI chip case?
Taiwan does not treat unauthorized AI chip exports to China as a standalone crime, according to Tom’s Hardware. That means prosecutors in this investigation have pursued alleged false paperwork rather than the underlying movement of chips.
The same legal path has shaped the wider case. Three people arrested in May were pursued over shipping declarations, and six people questioned during June raids involving Super Micro and two supply-chain partners were summoned on similar grounds, Tom’s Hardware reported.
The regulatory gap is awkward and very semiconductor-industry specific. Taiwan’s current controls use a named-entity list rather than a chip-performance threshold. Huawei and SMIC were among 601 entities added last June to the International Trade Administration’s strategic high-tech commodities entity list, which requires Taiwanese companies to get government approval before shipping to listed buyers.
That structure leaves room for shipments to buyers that are not on the list, even when the hardware is powerful. A rack of accelerators sent to a non-listed company would not require approval under that buyer-name system, according to Tom’s Hardware.
What controls are Taiwan and the U.S. weighing?
Taipei has been considering performance-based rules closer to Washington’s export-control model, Tom’s Hardware reported last month. Taiwan’s Ministry of Economic Affairs confirmed talks with the U.S. about putting advanced chips under regulation, but has not set a timetable.
The case is also drawing attention in Washington. Senator Elizabeth Warren, the ranking Democrat on the Senate Banking Committee, wrote on June 1 to Nvidia general counsel Tim Teter and audit committee chair Brooke Seawell. She asked what records support Nvidia CEO Jensen Huang’s public statement that there is no evidence of AI chip diversion, and whether the audit committee had reviewed export compliance after the March indictment of Super Micro co-founder Yih-Shyan “Wally” Liaw over roughly $510 million in diverted servers. Warren asked for answers by June 18.
There is still a legal route for some Nvidia chips into China. Since December, the U.S. Bureau of Industry and Security has reviewed H200 export licenses case by case under a 25% revenue-sharing arrangement, with about 10 Chinese buyers cleared for up to 75,000 units each. Commerce Under Secretary Jeffrey Kessler told the House Foreign Affairs Committee on July 14 that shipments under those licenses remain trivial.
Blackwell chips remain excluded from that channel. Tom’s Hardware reported that demand for restricted Nvidia parts has helped push five-year-old A100 servers to $82,000 on China’s domestic gray market.
This story draws on original reporting from Tom's Hardware.
