Officials arrested and charged two Chinese nationals, one of whom is an illegal immigrant, after they allegedly and “knowingly exported” tens of millions of dollars’ worth of sensitive microchips used in artificial intelligence applications to China, according to the Department of Justice (DOJ).
The DOJ released a press statement Tuesday identifying 28-year-old Pasadena, Calif. resident Chuan Geng and 28-year-old El Monte, Calif, resident Shiwei Yang as the suspects of their investigation. According to the press release, both have been charged with “violating the Export Control Reform Act, a felony that carries a statutory maximum penalty of 20 years in prison,” after Geng surrendered to officials Saturday and Yang was arrested the same day.
Geng is a lawful permanent resident, while Yang is an illegal immigrant who overstayed her visa. A federal judge ordered Geng released on $250,000 bail, with Yang scheduled for a detention hearing Aug. 12.
According to the affidavit filed with the complaint, both defendants between October 2022 and July 2025 allegedly “knowingly and willfully exported from the United States to China sensitive technology” through an El Monte-based company called ALX Solutions Inc. The alleged technology sent included graphic processing units (GPUs), which are “specialized computer parts used for modern computing,” without having first obtained a required license or authorization through the U.S. Department of Commerce.
The GPU chip, according to officials, is “designed specifically for AI applications” which can be used to help develop “self-driving cars, medical diagnosis systems, and other AI-powered applications.”
Officials alleged that the ALX Solutions Inc. company was founded shortly after the Commerce Department began to require licenses for “the advanced microchips that Yang and Geng are alleged to have illegally exported.”
“A review of export records, business records, and company websites indicates that a December 2024 shipment and at least 20 previous shipments by ALX Solutions involved exports from the U.S. to shipping and freight-forwarding companies in Singapore and Malaysia, which commonly are used as transshipment points to conceal illegal shipments to China,” the press release states.
In December 2024, ALX Solutions Inc. allegedly sent a shipment that had been falsely labeled as GPUs not subject to federal laws and regulations, officials reported. The shipment instead contained GPUs that required a license for export to China, which neither Geng, Yang, nor the company had applied for or obtained from the Commerce Department.
Officials alleged that ALX Solutions received “numerous payments” from companies based out of Hong Kong and China, which allegedly includes “a $1 million payment from a China-based company in January 2024.”
During their arrest, law enforcement searched ALX Solutions’ office and seized Geng’s and Yang’s phones, allegedly discovering “incriminating communications between the defendants, including communications about shipping export-controlled chips to China through Malaysia to evade U.S. export laws.”
The U.S. Department of Commerce’s Bureau of Industry and Security and the FBI are continuing to investigate. Geng’s and Yang’s arraignment is scheduled for Sept. 11, with no pleas taken during their initial appearance Monday.
(Featured Image Media Credit: Gregory Varnum/Creative Commons/Flickr)
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