Advanced Nvidia AI Chips May be at the Heart of Singapore Fraud Case Servers, Gov’t Official Says
Singapore says that servers used to commit the fraud announced last week had been supplied by the US tech giant, Nvidia. According to Reuters, a government minister has said Singapore fraud case servers may have contained advanced AI chips manufactured by Nvidia.
Fraud Server Investigations
Singapore has already reached out to authorities in the US to determine whether the servers involved in the fraud case contained items that are subject to Nvidia export restrictions. Three people have been charged with conspiracy to commit fraud on the supply of servers.
Singapore customs authorities and police raided 22 locations where they seized electronic locations and documentation. Two of the arrested persons are Singapore nationals. The third accused is a Chinese national who has been charged with fraud by false representation. Reports from local news outlets have linked the instance to smuggling of advanced AI chips from Singapore to China’s tech startup, DeepSeek.
“We assessed that the servers may contain Nvidia chips. Whether Malaysia was the final destination, we do not know for certain at this point,” Minister for Home Affairs and Law in Singapore K Shanmugam said on March 3.
According to the minister, the servers in question had been supplied to companies in Singapore by Super Micro Computer and Dell Technologies before being dispatched to Malaysia. The government official also added that Singaporean authorities had commenced independent investigations after receiving an anonymous tip-off. Singapore has committed to work with US authorities to investigate the fraud.
The Chinese Headache
Singapore legal proceedings for AI chip fraud come at a time when the US is investigating Chinese AI startup, DeepSeek. The company gained popularity in the AI industry earlier this year after it launched its chatbot that caused a market selloff in the tech sector. From its investigations, the US wants to determine whether DeepSeek has been using advanced chips manufactured by American companies that the country has placed under export restrictions.
Last year, media reports showed that Universities and research institutions in China had acquired advanced Nvidia AI chips. The institutions accessed the chips when they bought servers that were embedded with the chips from US companies including Taiwan company Gigabyte Technology, Dell, and Super Micro.
After the US, Singapore is the second-largest AI chip market for Nvidia. Last year, sales from the Asian country constituted 18% of its annual revenue. But the state mostly serves as an invoicing hub for sales made to other countries. As such, actual GPU shipments to the Asian city were far less, about 2% of Nvidia’s total revenue. This amounted to $35 billion in quarter 3. There are suspicions that some of these shipments may have ended up in the Chinese borders.
Larger Investigation
The latest Singapore fraud case is part of a wider investigation that authorities are pursuing. The investigation involves about 22 individuals and tech companies that are suspected to have misrepresented information. Authorities in the US and Singapore are concerned about organized AI chips smuggling AI chips into China. Singapore is considered a major transit route for these activities.
American AI industry leaders like Scale AI CEO Alexandr Wang say DeepSeek could be holding up to 50,000 advanced AI chips manufactured by Nvidia whose export to China has been restricted. Wan is yet to provide evidence to back these claims. DeepSeek is yet to address these allegations. Previously, the Chinese AI startup has admitted to using Nvidia H800 chips that were readily accessible in China back in 2023.
DeepSeek has also claimed that it has used supercomputing AI clusters that are powered by Nvidia A100 chips.
