A California man shipped $300 million in AI servers to China through Malaysia

Federal agents arrested Greg Lui, 38, of San Gabriel, California, on October 1, 2026, two days after a grand jury returned an indictment accusing him of sending more than $300 million of export-controlled computer servers to China. Prosecutors say the machines, built around American-made graphics processing units of the kind used for artificial intelligence, moved through Malaysia and Singapore on false paperwork. Lui is charged, not convicted.

The company at the center of the case is Earthmade Computer Inc., based in the City of Industry.

Three counts and the court

The case sits in the Central District of California, and the Justice Department’s announcement lists three charges: conspiracy to violate the Export Control Reform Act and the Export Administration Regulations, outbound smuggling, and conspiracy to commit money laundering. The indictment is dated September 29. The maximum penalties are 20 years for the export conspiracy, 20 years for money laundering and 10 years for smuggling.

The department’s own wording on the central allegation is that Lui and his co-conspirators used Earthmade “to buy and send export-controlled items to China without required licenses.” The release is careful about the posture of the case, stating that an indictment is merely an allegation and that all defendants are presumed innocent until proven guilty. Nothing in it reports a plea, and the arrest on October 1 came two days after the grand jury acted, so the case is at its earliest stage.

The Export Control Reform Act, passed in 2018, is the statute behind the first count, and the Export Administration Regulations are the Commerce rules that implement it. The three counts carry different maximum sentences because they rest on different laws: 20 years for the export conspiracy, 20 for money laundering and 10 for smuggling.

The $300 million figure belongs to the indictment’s description of the scheme, so it is the government’s valuation of what was allegedly shipped, not a total established at trial. The release phrases it as “more than $300 million worth” of servers.

The Malaysia and Singapore routing

According to the release, shipments passed through Malaysia and Singapore before reaching China. Between January and October 2024, Earthmade received more than $176 million from two Malaysia-based shipment companies, a figure the department presents as a traced payment stream rather than as the whole alleged $300 million. The $176 million equals about 59% of the $300 million total and covers only ten months of 2024, and it reflects money from two shipping companies rather than from the end buyers.

That routing is the legal crux. The Commerce Department’s Bureau of Industry and Security requires licenses for advanced computing items shipped to entities in Country Group D:5, which includes China, and Macau, “even if the entities themselves are located outside Country Group D:5 or Macau.” A server that stops in Malaysia or Singapore on its way to a Chinese buyer therefore does not escape the license requirement by changing hands in a third country. The indictment’s allegation of false paperwork goes to the other side of the case, the claim that the true destination was hidden from exporters and carriers.

The phrase “AI servers” is shorthand. The department’s text describes high-end computer servers containing U.S.-manufactured GPUs, gives their alleged value instead of a unit count, and says nothing in its announcement about which models or customers were involved. Readers should treat the dollar figure as the prosecution’s valuation, set out in a grand jury’s charging document, which a court has yet to test.

The department does not name the chipmaker whose processors sat inside the servers, describing them only as U.S.-manufactured GPUs commonly used for what it calls Super Intelligence applications.

The prosecutors and agencies on the case

The investigation drew on the FBI, the Defense Criminal Investigative Service and Commerce’s export-enforcement arm, and the prosecution is handled out of the U.S. Attorney’s Office for the Central District of California. Assistant Attorney General John A. Eisenberg called superintelligence “the defining technology of the era.” Bill Essayli, of the U.S. Attorney’s Office, said prosecutors will aggressively pursue those who put national security at risk. FBI Assistant Director Roman Rozhavsky said that controlling the export of advanced technology is critical.

The department’s release quotes no defense lawyer, so Lui’s side of the account is absent from the public record the announcement provides. Eisenberg’s remark frames the case as a technology-security matter more than a customs one, and the three agencies named together reflect that: one handles criminal investigation, one military contracting and defense-related fraud, and one the export licensing rules that were allegedly bypassed. The next filings in the Central District will show how Lui pleads to counts that carry up to 20 years each, and whether the $176 million traced from Malaysia becomes the center of the money laundering case.

This article was produced with the assistance of AI and reviewed by Morning Overview editors prior to publication.

More from Morning Overview