Someone got caught smuggling computer components into China, again

Insights Desk,

Facepalm: For the fourth time in three weeks, someone has been caught trying to smuggle electronics into China to exploit sizable price differences and avoid import taxes. The latest case is Hong Kong’s biggest bust in five years, but the perpetrator’s technique was far less imaginative than prior reported attempts.

This week, Hong Kong authorities reported having caught the biggest attempt to smuggle electronic hardware into China since 2018. The announcement comes only a few days after three other unsuccessful attempts to sneak chips into the country from Macau.

A 61-year-old truck driver tried to smuggle HK$30 million (about USD $3.8 million) of electronics through Man Kam To Control Point from Hong Kong into mainland China. Attempts to slip devices like CPUs or smartphones past Chinese customs to dodge duties have become common over the last several years because they’re more expensive in mainland China than in many other countries. The incidents primarily occur at checkpoints bordering Hong Kong and Macau due to economic differences between those two territories and the mainland.

Customs officials at a Macao checkpoint foiled three separate attempts in March. The most recent involved a man who strapped 239 Intel CPUs to his body. A few days earlier, someone there tried to hide 84 SSDs in his motor scooter’s hollow steering rod. In mid-March, another person tried to smuggle 160 processors by taping them to himself.

Hiding contraband underneath clothes seems to be a popular strategy. In 2017, a woman in Shenzhen (likely coming from Hong Kong) unsuccessfully tried the technique with 102 iPhones. Another Hong Kong incident in 2021 involved the method with 256 CPUs, worth $123,000. Last year, a woman traveling from Macau tried to use a fake pregnant belly to hide 202 Intel processors and a few iPhones.

Conversely, the latest Hong Kong incident didn’t involve any fancy schemes, which seemingly don’t work anyway. Although, it’s unclear how many smugglers successfully evade detection for each one the authorities catch. After all, the frequency of reports indicates it’s a worthwhile business.

In any case, the amount of hardware the Hong Kong truck driver tried to bring in was far too much to strap to his body – so he just packed it into crates and lied about what was in them. The driver had around 30 wooden boxes labeled as electronic screens, which likely incur lighter import taxes. However, an X-ray scan revealed the crates contained almost 510,000 pieces of gear, including CPUs, storage drives, laptops, and smartphones.

Although the smuggler was arrested, he’s already out on bail pending an investigation. The maximum penalty for the crime is a HK$2 million (about USD 254,000) fine and seven years imprisonment.

Tech

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