“There was one case, where one person has actually pled guilty already, where they declared restricted NVIDIA hardware to be, quote-unquote, adapter modules. … Really, adapter modules that weigh 2,000 pounds. So there are lots of cases where it's like, really, that's an eyebrow-raising declaration. … It's actually a very sophisticated black market. There are contracts. Brokers go and solicit hardware on behalf of specific suppliers.”
sputnikintelligence.com
Tracy Alloway had joked about chip smugglers in trench coats. Hawkins, who covers export controls for Bloomberg, explains that smuggling cases usually involve false customs declarations on very heavy server hardware, and describes how organised the black market is.
…the server manufacturers need to do to make sure that the actual stated destination of the chips exists. And there are some cases where prosecutors have alleged the data center like literally didn't exist. There was never a place for those chips to go. They were just always intended to go to China.
Wait, can I just, I'm a little bit disappointed. Are there no like chip mules out there? People who are just like, I don't know. I have this vision of someone in a trench coat and they like open it up and it's lined with like probably not H100s with blackwells or something.
Well, you know, it's funny that you say that because, you know, in one of Jensen's many denials of chip smuggling as an issue, he said, you know, the Grace Blackwell system weighs you tons. You're not putting that in your backpack in your pocket anytime soon. We reported a couple months ago that the U.S. government has been investigating a Singapore headquarter logistics company that especially like literally specializes in tech hardware transportation through complicated logistics. These are fragile systems and transported or is believed to have transported restricted hardware. And then it's a question of like, okay, if you're a logistics company, then how much is it your job to know what's in the package? So a lot of these cases also involve false declaration or allegedly involve false declaration, putting on customs forms that it's just a computer server. Ambiguous what type of computer server. Sometimes random electronics. There was one case where, and this is a case where one person has actually pled guilty already, where they declared restricted NVIDIA hardware to be quote-unquote adopter modules. This is a category of electronics that includes like the thing you use to plug your phone into a form code…
the good
honest black market for like
legitimate honest black market brokers. No, it's a pretty extraordinary and sophisticated sprawling ecosystem.