Treasury Secretary Scott Bessent on Friday put the blame squarely on Commerce Secretary Howard Lutnick’s department for failing to blacklist Megaspeed, the Singapore-based company at the center of the espionage scandal that brought down Nvidia CEO Jensen Huang.
Appearing on CNBC’s “Squawk Box,” Bessent was asked about reported tension between the two Cabinet officials over why Megaspeed still has not been added to the federal Entity List, which would restrict its access to advanced American AI chips.
“I can tell you there was coordination,” Bessent said. “Treasury, War, USTR, and State were in favor of putting Megaspeed on the entity list for months. But Commerce has the pen. And you will have to ask them about their internal processes.”
Megaspeed was previously led by Alice Huang, a suspected Chinese intelligence asset who had an affair with Jensen Huang. The Nvidia co-founder stepped down from the company after the affair came to light. The U.S. government suspects Megaspeed of buying Nvidia chips for its data centers in Southeast Asia and routing them to China in violation of U.S. export controls. The firm reportedly traded more than $4 billion worth of Nvidia chips over two years.
According to the New York Times, the Commerce Department had been investigating Megaspeed last year over suspicions it was smuggling advanced Nvidia chips into China. Even so, the company was never placed on the Entity List.
Bessent said he was frustrated by the delays and by reports that chips were leaking into China.
“President Trump made it very clear that China should not receive any Nvidia chips above H100s, so any leakage is very frustrating because it hurts our great companies in the AI race, because it gives the Chinese an advantage,” he said.
The Treasury chief also turned his attention to Nvidia itself, arguing that coverage of the scandal has focused too heavily on Huang’s personal life.
“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 said. “I think it’s important that anyone at the company there be held accountable for that.”
Bessent reportedly confronted Lutnick in the White House Situation Room over the Commerce Department’s alleged reluctance to rein in Nvidia and enforce export controls. He declined to discuss closed-door conversations or comment on the reported friction between the two men.
Lutnick’s handling of chip export controls has drawn growing scrutiny from both parties, and a growing number of Republicans want answers. On Thursday, Senate Banking Committee Chairman Tim Scott, R-S.C., asked Lutnick and Huang to appear before his panel in early December. According to a U.S. official, Lutnick has agreed to testify before the committee on Dec. 10.
Despite the mounting pressure, the White House is standing by Lutnick and says President Trump has confidence in him.
Bessent’s remarks mark a rare public split between two of the president’s top economic officials as the fallout from the Nvidia scandal continues to widen.
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