“For months” US treasury secretary Scott Bessent has favored putting data company Megaspeed on a trade blacklist to block Nvidia from exporting advanced chips to Beijing, but the effort stalled because “commerce has the pen,” he said in an interview with CNBC.
Bessent pointed the finger at the Commerce Department during his Friday interview, stating that federal agencies including the Treasury and State departments had supported adding Megaspeed to an export restriction list for months, according to TradingView. The controversy erupted after revelations that former Nvidia CEO Jensen Huang had a relationship with Alice Huang, a top executive at Megaspeed whom US intelligence agencies believe is a Chinese spy, The New York Times reported.
The dispute highlights growing friction within the administration over technology controls and export enforcement. While Trump officials agree on tightening restrictions against China, internal disagreements over implementation have spilled into public view following Huang’s resignation and falling Nvidia shares.
Lutnick faces criticism over Nvidia sales
Commerce Secretary Howard Lutnick has faced mounting criticism from lawmakers and administration officials over his department’s handling of Nvidia chip sales to Asia. Critics allege that the Commerce Department grew too cozy with Nvidia and Jensen Huang, failing to adequately police chip shipments to suspected pass-through entities like Megaspeed, according to The New York Times.
Behind closed doors, tensions boiled over when Bessent confronted Lutnick in the White House Situation Room regarding the delayed blacklist, CNN reported. Bessent declined to comment directly on the meeting during his CNBC appearance, stating, “We don’t repeat conversations in the Situation Room.”
“You will have to ask them about their internal process,” US treasury secretary Scott Bessent added in an interview with CNBC.
Details from inside the room w/@MarcACaputo: At a White House Situation Room meeting on Thursday after the midterm elections, Treasury Secretary Scott Bessent pressed Commerce Secretary Howard Lutnick on why Megaspeed had not been added to the Commerce Department's entity list.…
Commerce Secretary Lutnick has voluntarily agreed to appear before the Senate Banking Committee on December 10, The Guardian reported, to address his relationship with Jensen Huang and the regulatory delays involving Megaspeed.
Bessent questions Nvidia customer screening
Treasury Secretary Bessent argued that the primary question in the export scandal is whether Nvidia knew its customers and took adequate steps to prevent restricted hardware from reaching unauthorized buyers.
“The real story here should be: Did Nvidia know their client, and was there a robust effort at Nvidia to make sure that there was no leakage and that they were selling to what were obviously pass-through shell companies,” Bessent told CNBC.
Bessent added that while the Treasury Department’s Office of Foreign Assets Control lacks jurisdiction over export decisions, the Commerce Department’s Bureau of Industry and Security holds the necessary authority to enforce restrictions.
He said that allowing China to acquire older H100 chips would grant limited strategic advantage compared to more advanced technology, but any leakage remains frustrating.
Nvidia named Chief Financial Officer Colette Kress as interim CEO on Thursday, the BBC reported, as the company searches for a permanent replacement following Jensen Huang’s resignation.
Why Megaspeed remains off the blacklist?
Why hasn’t Megaspeed been placed on the US trade blacklist?
Treasury Secretary Scott Bessent said that while the Treasury and State departments supported adding Megaspeed to the trade blacklist for months, the Commerce Department held decision-making authority over export controls and did not follow through.
What specific chip sales are at the center of the export policy debate?
Administration officials have focused on sales of advanced Nvidia processors to Asian markets, specifically addressing concerns that entry-level A100 chips and higher could reach unauthorized buyers in China through intermediaries like Megaspeed.
This Administration's greed is out of control, putting America's national security at risk. Commerce Secretary Howard Lutnick has betrayed the public trust and must immediately resign. If he fails to do so on his own accord, Congress must hold him accountable and move forward…
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