Police in Singapore have arrested three men on fraud charges, relating to the supply of servers containing sanctioned Nvidia chips.

According to a report from Channel News Asia, the two Singaporean nationals and one Chinese national misrepresented the final destination of Dell and Supermicro servers, allegedly diverting them from their official destination of Malaysia.

In a separate report, Reuters said local media had linked the transfer of chips from Singapore to the Chinese AI company DeepSeek, although the source for those claims was not identified.

Singapore's Home Affairs and Law Minister K Shanmugam told reporters the arrests were made following an anonymous tip-off and that the investigation was ongoing. He added that the Singaporean authorities had asked the US to look into whether the servers contained restricted chips and that the city-state would assist them in a joint investigation, if necessary.

The US government has long restricted the export of cutting-edge AI chips to China, claiming that the sanctions are to stop the country from having access to advanced technology that could be used for military modernization and human rights abuses.

However, this hasn’t stopped China from getting its hands on restricted chips, with reports from 2024 suggesting that Chinese companies had still been able to obtain Nvidia chips contained in server products made by Supermicro, Dell, and Taiwan’s Gigabyte.

During the final weeks of his administration, former US President Joe Biden brought forward the widely-criticized Interim Final Rule on Artificial Intelligence Diffusion, further restricting the access of AI chips and AI model weights to countries not on the US government’s allies and partners list.

The new export rules have since entered into a 120-day consultation period and it will be up to the Trump administration to decide whether or not to modify and/or implement the legislation.