The US arrested two Chinese nationals for allegedly illegally selling sensitive microchips used in AI applications to China, the Justice Department said, days after two American citizens were detained in Beijing.
In a statement, the department said on Tuesday that Chuan Geng and Shiwei Yang are accused of exporting “tens of millions of dollars’ worth of sensitive microchips used in artificial intelligence (AI) applications” without obtaining a license from the Department of Commerce between October 2022 and July 2025 through their El Monte-based company, ALX Solutions.
According to the statement, the company sent the chips in more than 20 shipments over three years to logistics firms in Malaysia and Singapore, from where they were later transferred to China.
“ALX Solutions has not received payments from the entities to which they purportedly exported goods. Instead, ALX Solutions received numerous payments from companies based in Hong Kong and China, including a $1 million payment from a China-based company in January 2024,” it said.
Geng and Yang “are charged with violating the Export Control Reform Act, a felony that carries a statutory maximum penalty of 20 years in prison,” said the statement.
Exit bans escalate
The US arrests come days after China announced "exit bans" on two American citizens—a US government employee and a senior banker—who were visiting China.
The US State Department confirmed on July 22 that a US Patent and Trademark Office employee has been barred from leaving China for over three months. The man, also a US Army veteran, reportedly failed to declare his government affiliation on a visa application.
Shortly before, Mao Chenyue, a Shanghai-born US citizen and Wells Fargo managing director, was placed under an exit ban while on a business trip to China. She has been unable to return to the US, and Wells Fargo has since suspended all employee travel to China.
China’s Foreign Ministry confirmed Mao’s travel restriction, saying it was part of a “criminal investigation,” but declined to provide details. “Everyone in China, whether Chinese or foreign, must abide by Chinese laws,” said spokesperson Guo Jiakun.
The exit bans came just as Chinese-American engineer Chenguang Gong pleaded guilty in California to stealing over 3,600 sensitive files intended for military use, according to a Justice Department statement released on July 21.
US authorities said Gong had ties to Chinese “talent programs” and proposed developing military-grade infrared and radar technology for Beijing.
