US approved Nvidia AI chip sales to empty office in China

Oversight regarding advanced artificial intelligence exports is facing intense questioning after reports emerged that neither the Commerce Department nor Nvidia performed adequate due diligence. Authorities cleared the transfer of high-performance hardware to Chinese entities despite underlying connections to trade restrictions tied to national security.

According to investigative findings by The New York Times, a firm called New Matrix made it onto the list of approved buyers permitted to handle Nvidia's H200 AI chips. However, visiting its registered address revealed a hollow gray shell with dangling ceiling wires where light fixtures should be, showing virtually no proof of actual business operations.

Stock photo for illustration only, not from the actual event

Further inquiry into New Matrix revealed several unsettling details:

• The company was incorporated a mere 17 months prior to the investigation.
• Building directories and property management staff at the industrial park confirmed no record of the firm's existence.
• Scant public information is available online regarding its background or commercial footprint.

Beyond the vacant office space, the company's backers share ties with a Chinese private equity firm that has remained on the US government blacklist since 2024. Observers note that this oversight lapse is not an isolated incident, but rather part of a recurring pattern where entities connected to trade-restricted organizations successfully clear checks to purchase restricted processors.

Source: The Verge