The West’s technology brains and universities are arming China. A few of them are potentially breaking the law to do it, but most of them don’t need to. The front door has been open for years, and nobody in London or Washington has thought to close it.

According to a federal indictment unsealed in Manhattan last month, on December 18, 2025, in a warehouse somewhere in Southeast Asia, a team of men used a hair dryer to peel serial-number labels off genuine server boxes and press them onto fakes. The real servers, loaded with some of America’s most restricted artificial intelligence hardware, are alleged to have long since been shipped to China. What remained, according to the indictment, were dummies – non-working replicas repackaged to look untouched. Surveillance cameras recorded the whole operation.

The next morning, a United States Commerce Department inspector arrived to verify the shipment. One of the men from the warehouse introduced himself as “Michael,” a legal assistant. Prosecutors say his real name is Ting-Wei “Willy” Sun, a fixer in a $2.5 billion smuggling operation, and that everything he told the inspector was false.

According to the indictment, Sun helped divert shipment after shipment of advanced AI servers from SuperMicro, one of Silicon Valley’s most important hardware companies, to buyers in China. The servers were the kind the US government restricts because of their potential use in weapons development and mass surveillance.

Selling chips to China is one thing, but giving Chinese engineers the keys to the Pentagon is another

Selling chips to China is one thing, but giving Chinese engineers the keys to the Pentagon is another

The alleged architect of the scheme was not a Chinese intelligence operative. He was SuperMicro’s co-founder and senior vice president, Yih-Shyan “Wally” Liaw, a United States citizen. Both Liaw and Sun have pleaded not guilty to the charges against them. SuperMicro has not been named as a defendant and has said it is cooperating fully with the investigation. It has also confirmed that it has severed ties with Sun, who was a contractor, and has placed Liaw on leave. The company was itself embroiled in similar allegations 19 years ago. SuperMicro pleaded guilty in 2006 to illegally exporting computer equipment to Iran through a distributor in Dubai, using the same structure at the center of this indictment: a front company in a neighboring country, a disguised end buyer, restricted technology shipped onward. Combined federal penalties came to roughly $455,000.

Liaw left SuperMicro in 2018 amid an accounting scandal that led to the company’s delisting from Nasdaq. Then the company brought him back three years later and eventually restored him to the board.

What makes the Liaw case unusual is not what is alleged, but that evidence held by prosecutors indicates........

© The Spectator