Alleged AI chip smuggling to China leads to US calls for chip tracking

The U.S. Justice Department has charged four people in a scheme to illegally export Nvidia AI chips to China, prompting a key House Republican to call for urgent passage of a chip-tracking bill on Thursday.

"China recognizes the superiority of American AI innovation and will do whatever it must to catch up," said John Moolenaar, the chair of the U.S. House Select Committee on China. "That's why the bipartisan Chip Security Act is urgently needed." The legislation, which Moolenaar introduced in May and has 30 cosponsors, would require location verification for chips, make it mandatory for chipmakers to report and share information about potential diversion, and look at additional ways to stop U.S. chips from ending up in the wrong hands.

The case highlights the challenges Washington faces