Just Put “Not China” on the Form
Federal prosecutors arrested Greg Lui, 38, the owner of a San Gabriel Valley technology company, on charges connected to the alleged smuggling of more than $300 million worth of export-controlled computer servers containing U.S.-manufactured graphics-processing units.
According to the indictment described by DOJ, Lui and co-conspirators allegedly bought the servers for delivery to destinations that did not require the same licenses, including Malaysia and Singapore, then arranged for them to be reshipped to China. The paperwork allegedly identified permissible end users and destinations while the actual destination was somewhere else.
International Shipping, With Extra Steps
The government says the company received more than $176 million from two Malaysia-based shipment companies during the alleged scheme. In one example, a purchase order covered 27 servers costing about $7.6 million. The servers went from Los Angeles to Kuala Lumpur, while a Malaysian official later indicated they had been transshipped to a China-based buyer.
Lui faces charges of conspiracy to violate export-control laws, outbound smuggling and conspiracy to commit money laundering. An indictment is an allegation, and he is presumed innocent unless proven guilty.
The Bottom Line
Export controls are not a scavenger hunt where restricted technology becomes legal after stopping in Singapore. If the destination is hidden by a chain of paperwork and freight-forwarding detours, the route may be the most suspicious thing in the shipment.
Source
U.S. Department of Justice: California man arrested in alleged $300 million server-smuggling scheme