Stern said text messages obtained by authorities show Li bragging about how his father “ran a similar business on behalf of the Chinese Communist Party.” Stern claims the reports also show that Lee, who works for a hardware distribution company, knew from news articles he shared that Nvidia chips were subject to export controls. “He explained that his father had ways of importing them,” Stern said, again citing Lee's text messages.
Stern told the court that Lee “did admit various facts” during questioning by federal agents Wednesday that related to his involvement.
The defendants face various charges related to violations of export control laws and prison sentences of up to 20 years.
Ho and Raymond did not immediately respond to requests for comment sent to LinkedIn accounts believed to belong to them. Public defenders for Chen and Li declined to comment.
Nvidia spokesman John Rizzo said in a statement that “even small aftermarket sales of older generation products are subject to strict controls and audits” and that “trying to cobble together data centers from bootleg products is a futile move from both a technical and economic standpoint.”
Corvex, an artificial intelligence cloud computing company that Raymond advised, said in a statement that it had rescinded his full-time job offer and that it had nothing to do with the alleged wrongdoing.
Earlier this year, the US Commerce Department was reported to be considering restricting sales of advanced chips to Malaysia and Thailand to curb chip smuggling, but the rules have yet to be finalized. The Commerce Department did not immediately respond to a request for comment.
Magistrate Judge Westmore ordered Lee to hire an attorney because she said he owned significant equity in a home and other assets in San Leandro, California, which disqualified him from appointing a public defender. The magistrate also scheduled a hearing for Tuesday to decide whether Lee poses a serious flight risk and whether to remain in custody. He has a US green card and Hong Kong citizenship.
Lee, wearing glasses, flip-flops and a black windbreaker, nodded at some of Westmore's statements but said nothing. Caitlin Fryzek, his interim public defender, said Lee plans to marry a U.S. citizen. “His incentive is to stay and marry his fiancée,” Fryzek said.
