Chinese Customs Bust One Of The Largest CPU Smuggling Attempts, 596 Intel Xeon Chips Valued At $1.2 Million

Chinese customs have intercepted another smuggling attempt with the culprit running away with 596 Intel Xeon CPUs worth over $1 million.

Our reporting on smuggling attempts worldwide is extensive, but until now, we haven't witnessed a higher "intensity" of a case. Such incidents usually surface in China, where smugglers illegally transport PC hardware to escape regional taxation and policies. We previously calculated that smuggling incidents in China totaled a shocking $4 million in 2022-2023, and this figure doesn't look to stop yet.

In the incident, Hong Kong customs reportedly intercepted a vehicle crossing the local borders at Shenzhen Bay. Upon suspicion, the vehicle underwent an X-ray examination where the presence of smuggled goods was detected in compartments at the sides. Diving into the issues, the officers on the scene found out that the car was carrying a total of 596 Intel Xeon CPUs wrapped around in a plastic film, making it one of the biggest attempts at PC hardware smuggling of all time.

It is reported that the total cost of smuggled processors is around $1.2 million, and if the attempt were carried out successfully, the individual would've evaded around $380,000 in taxes, which is a massive amount. While we are unaware of what kind of processors they were, initial images show that they are server-grade Intel Xeon CPUs (most probably an older generation), given the product valuation and the general shape of the processors.

This isn't shocking at all, given that with the ongoing AI frenzy, we have seen all kinds of similar incidents, including "black market" AI accelerators and much more. China is emerging as a dominant AI and cloud computing force, so the occurrence of such smuggling incidents is expected, especially for third-party sourcing groups in the region. It is said that the smuggler now faces seven years in prison, showing that smuggling is a serious offense anywhere in the world.

News Source: MyDrivers