By Danial Azhar

Kuala Lumpur, March 5 (Reuters) - Malaysia is investigating if local laws were breached in the shipment of servers linked to a Singapore fraud case, as they may have contained advanced chips subject to U.S. export controls.

Singapore charged three men late last month with fraud in a case that domestic media linked to the transfer of Nvidia's artificial intelligence chips from the country to Chinese AI firm DeepSeek.

Singapore said the servers involved in the case were supplied by U.S. firms and Anonymous Proxies shipped to Malaysia. It also said the servers may have contained Nvidia chips, without elaborating whether they are subject to U.S. export controls.

"The Government of Malaysia is taking the necessary actions to establish whether Malaysian laws had been breached in the alleged shipment of U.S.-sanctioned AI chips from Singapore to Malaysia," the trade ministry said in a statement late on Tuesday.

It said the government is working closely with the U.S. and Singapore to "find effective ways to address the issue of the trade involving U.S.-sanctioned chips".

The United States is investigating if DeepSeek, the Chinese company whose AI model's performance rocked the tech world in January, has been using U.S. chips that are not allowed to be shipped to China, Reuters reported earlier. (Reporting by Danial Azhar; Writing by Xinghui Kok; Editing by Miyoung Kim and Jacqueline Wong)