Aug. 6 (UPI) — Two Chinese nationals residing in California have been arrested and charged with violating export control laws by allegedly shipping advanced microchips used in artificial intelligence to China.
The Justice Department announced the case against Chuan Geng, 28, of Pasadena, and Shiwei Yang, 28, of El Monte, in a statement Tuesday. Federal prosecutors said Geng, a lawful permanent resident, surrendered to authorities on Saturday, the same day Yang, an undocumented immigrant, was arrested.
According to court documents, their El Monte-based company, ALX Solutions, allegedly exported tens of millions of dollars’ worth of sensitive technology, including graphics processing units to China without federal authorization from October 2022 until last month.
The prosecutors alleged that at least 20 shipments sent by the company before December 2024 went to what are called freight-forwarding companies in Singapore and Malaysia to conceal the illegal shipments to China.
The company also received numerous payments from companies based in Hong Kong and China, which were not the entities they had claimed they were exporting goods to, the prosecutors allege.
The charges follow a raid last week of ALX Solutions, during which law enforcement seized phones belonging to Geng and Yang containing what the Justice Department called “incriminating communications,” including about shipping export-controlled chips through Malaysia to China to evade U.S. laws.
On Monday, a Los Angeles court ordered Geng released on a $250,000 bond. Yang is scheduled for a detention hearing on Tuesday. Arraignment is scheduled for Sept. 12.
If convicted of violating the Export Control Reform Act, each defendant faces a maximum penalty of 20 years in prison.
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