Supermicro fired staff after probe into $2.5 billion GPUs-to-China smuggling operation
Supermicro has fired some staff after conducting an investigation into allegations that its execs participated in a scheme to ship $2.5 billion worth of servers packing Nvidia GPUs to China, in violation of US export controls.
In March, the US Department of Justice indicted Supermicro co-founder Yih-Shyan "Wally" Liaw, one of the company’s Taiwan-based execs Ruei-Tsang "Steven" Chang, and a man thought to act as a broker, Ting-Wei "Willy" Sun, with conspiring to violate the Export Controls Reform Act, conspiring to smuggle goods and defrauding the US government.
Supermicro promised to investigate and on Thursday delivered its verdict: nobody on its current senior management team “had knowledge of the alleged diversion scheme or of any actual diversion of restricted products by the Company.”
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“Nor did the investigation find that the Company directly sold export-controlled products to known restricted parties or locations. It also did not find any evidence that the Company’s previously issued financial statements could not be relied upon based on the potential diversion of restricted products,” the company states.
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But not all is well, as it seems Supermicro did find staff who failed to properly implement US export controls.
The company says the three people named in the indictment “no longer have any relationship with Supermicro.” That suggests Liaw and Chang were let go.
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Supermicro’s statement also revealed the investigation led to sackings elsewhere in the company.
“In connection with the investigation, the Company took several personnel actions with respect to employees within its sales, technical support and business development functions, including terminations, for failure to follow Company policies or the Company’s code of conduct,” the announcement states.
We’ve asked Supermicro how many staff it dismissed or disciplined, and how they breached company policies and the code of conduct. We will update this story if we receive a substantial response.
The company has also revealed that the investigation led to recommendations that “further enhance the Company’s export compliance program.” Supermicro’s board has adopted those recommendations in full, and has already implemented some of them.
Supermicro has therefore admitted that its compliance program was not sufficient, and that some of its staff conducted activities deemed worthy of dismissal.
That adds to the company’s long list of past governance issues, which includes twice dodging de-listing due to accounting dramas, another unauthorized export probe spanning Singapore and Taiwan, and struggling to cash in on the AI boom. ®
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