# Smuggler describes routing restricted AI memory into China through processor exports

_Published Tuesday, November 3, 2026 at 8:25 AM EST · AI, Products · Latest · Tier 2 — Notable_

![Chip with HBM next to it — Primary](https://cdn.mos.cms.futurecdn.net/rWdHT5SLeyUQVnKviKvckN-1920-80.jpg)

A chip smuggler described routing export-controlled high-bandwidth memory from South Korea into China by attaching it to low-performing processors, Tom's Hardware reported, citing The Information. The reported loophole relies on export rules assessing the processor's performance rather than the memory attached to it.

The assemblies travel through Hong Kong before commuters carry them into Shenzhen, where workshops remove the memory and discard other components. A Shenzhen broker said an HBM3E unit now sells for about $4,000, compared with several hundred dollars a year ago. Removing the chips has a high failure rate, but their resale value makes the operation lucrative.

## Sources

- [Tom's Hardware](https://www.tomshardware.com/tech-industry/semiconductors/ai-chip-smugglers-exploit-trade-control-loophole-to-bring-banned-hbm-from-south-korea-into-china-expensive-memory-chips-packaged-with-cheap-unsanctioned-processors-to-become-legal-exports)

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Canonical: https://techandbusiness.org/newswire/bhWcg-q78oO-51gqW-Vf9E
Published: 2026-11-03T13:25:10.269Z
Story chronology: 2026-11-03T12:04:32.000Z
Retrieved: 2026-11-03T16:05:00.340Z
Publisher: Tech & Business (techandbusiness.org)