Malaysia seizes AI servers in suspected chip smuggling network

What happened

Malaysian customs seized AI servers worth around MYR 49.5 million (USD 12.1 million) at Kuala Lumpur International Airport, and authorities believe the shipment is linked to a syndicate that has been smuggling high-performance chips through the country. Citing the airport's customs director Aspalila Ag Tuah, Reuters reports that the 30 server units containing advanced AI chips were found on 15 October during an inspection in the airport's free trade zone. The shipment came from an Asian country and was to be re-exported to another country in the region, which requires a trade permit; neither country was named. Aspalila said the servers were falsely declared as electronic components and shipped through Malaysia to ensure no restrictions would be imposed when being exported to the next destination. According to the customs authority, the shipment was suspected to be handled by the same network behind a similar smuggling attempt stopped in June; at least five cases have been linked to the syndicate so far, with seizures worth a total of more than MYR 100 million (around USD 24 million). A Malaysian company that facilitated the shipment has been called in to assist the investigation. As background, Malaysia introduced export controls last year on advanced AI chips of US origin, after pressure from the United States to stop the chips from reaching China. The source does not state any price impact.

Impact and signal

Affected components and suppliers

Source and time

Source: Evertiq · 10/28/2026 · View original source