Two Chinese nationals have been taken into custody in Los Angeles, charged with the illegal export of sensitive microchips to China, a move that the U.S. Department of Justice claims could have serious implications for artificial intelligence (AI) technology. The suspects, Chuan Geng and Shiwei Yang, allegedly circumvented federal laws by shipping the high-tech components without proper authorization, according to a press release from the Justice Department.
Both Geng, 28 of Pasadena, and Yang, also 28 of El Monte, face charges under the Export Control Reform Act, a conviction of which could result in up to 20 years in prison. Geng, a lawful permanent resident, and Yang, identified as an illegal alien who overstayed her visa, allegedly conducted their operations through ALX Solutions Inc., based in El Monte. According to the Justice Department's announcement, the company began its questionable exports shortly after the Commerce Department imposed increased license requirements for advanced chips, such as those shipped to China.
Details provided by the Justice Department indicate that the two accused knowingly exported GPUs essential for AI applications between October 2022 and July 2025 without obtaining the necessary permissions. These GPUs are integral for developing technologies such as self-driving cars, medical diagnosis systems, and other AI-powered applications. When making an initial appearance in court, Geng was ordered released on a $250,000 bond, whilst Yang's detention hearing is scheduled for August 12, with arraignment on September 11.
The affidavit suggests these exports were deceptively routed through Singapore and Malaysia, common transshipment points used to obscure the final destination of China. The defendants are accused of shipping goods under falsified claims that the packages adhered to federal regulations, yet actually contained licensure-requiring GPUs. Following a search at ALX Solutions' office, law enforcement officials seized phones belonging to Geng and Yang, uncovering incriminating evidence about their alleged attempts to evade U.S. laws. The investigation is currently being conducted by the United States Department of Commerce’s Bureau of Industry and Security, and the FBI, with Assistant U.S. Attorneys Colin S. Scott, Joseph Guzman, and Jenna Long prosecuting the case.
