Taiwan detains 2 Super Micro employees in AI chip smuggling case to China

Taiwanese prosecutors have arrested two local employees of the U.S. company Super Micro as part of an investigation into the alleged illegal export of advanced artificial intelligence (AI) servers to China. These servers were reportedly manufactured by the American firm and equipped with chips from Nvidia.

Super Micro, headquartered in San Jose, California, confirmed that Taiwanese authorities questioned four of its employees on the island. The company stated that two employees were detained, while the other two were released on bail. "We have zero tolerance for anyone who violates the law or our internal policies, and all four employees have been immediately suspended pending the conclusion of the Taiwanese investigation," said Matt Thauberger, the company's chief revenue officer. He clarified that Super Micro is not the target of the investigation.

The company affirmed its cooperation with Taiwanese authorities over several months and noted that its offices in Taiwan were not raided. Super Micro reiterated its commitment to protecting U.S. interests and safeguarding advanced technologies, asserting that the ongoing investigation does not impact its business operations. The company's shares, traded on the Nasdaq, closed down 5.73% on Wednesday.

In a separate statement to the Taipei Stock Exchange, Super Micro's local distributor, Albatron, announced the detention of a "senior executive" in connection with the same case and appointed an interim replacement. These arrests follow searches conducted by the Keelung District Prosecutor's Office at a dozen locations, including the headquarters of Super Micro, Albatron, and Chief Telecom. Prosecutors stated that the initial suspects were fully aware that the servers were subject to strict export controls and were prohibited from being sold to China, Hong Kong, and Macau.