Kathmandu— Taiwanese authorities have indicted nine people connected to Nvidia and Super Micro Computer for allegedly exporting artificial intelligence servers to China despite US export restrictions. The group is accused of breach of trust, document forgery, and embezzlement in a scheme that involved shipping the servers through Indonesia and Japan, as well as direct exports. Prosecutors say the illegal activity occurred over an unspecified period and was motivated by profit, potentially damaging Taiwan’s international reputation.

Details of the Illegal Exports

Prosecutors in Keelung revealed that eight of the indicted individuals – one Nvidia employee and two from Supermicro – face charges related to breach of trust and document forgery. The servers were reportedly shipped through multiple routes, with 50 transshipped via Indonesia, eight sent through Japan, and others exported directly to China. An additional 56 servers were seized by Taiwanese border authorities as part of the investigation.

Company Responses

Nvidia stated that its employees are incentivized to ensure legal compliance and pledged cooperation with Taiwan’s authorities to resolve the allegations quickly. Supermicro emphasized its own cooperation, noting that it led to the arrest of two former employees of its Taiwanese subsidiary, and clarified that the company itself is not a target of the investigation or accused of wrongdoing.

Legal Ramifications and Sentencing Requests

Prosecutors are seeking jail sentences of up to five years for seven defendants they allege were driven by profit. They cited increased compliance costs and damage to Taiwan’s international image as consequences of the scheme. More lenient sentencing is being requested for two other defendants who confessed and cooperated with investigators.

Taiwan's Export Controls

The case highlights a gap in Taiwanese law, as directly exporting restricted technology isn’t currently a crime—leading prosecutors to rely on existing laws regarding breach of trust and forgery. Taiwan has been increasing export controls in recent years amid growing concerns about the transfer of advanced technologies to China, which claims Taiwan as its territory.

The investigation remains ongoing as Taiwanese authorities continue to address loopholes in their export control regulations and seek to prevent further illegal shipments of sensitive technology.

(With inputs from Al Jazeera)

Originally published on abcnews.com.np.