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The Treasury secretary said several US agencies had backed adding Megaspeed to an export control list months ago, but the Commerce Department was responsible for acting on the proposal.
US Treasury Secretary Scott Bessent on Friday criticised the Commerce Department for delaying restrictions on exports of certain Nvidia chips to China, saying several other government agencies had supported action against a company linked to the chipmaker.
Speaking to CNBC, Bessent said the Treasury, State and Defence departments, along with the US Trade Representative, had favoured placing Singapore-based Megaspeed International on an export control list for months. However, he said the Commerce Department was responsible for taking the decision.
“I am frustrated when President Trump made it very clear China should not receive any Nvidia chips above H100s,” he said, referring to an older generation of the company’s advanced AI chips. Commerce “has the pen, and you will have to ask them about their internal processes.”
The remarks amounted to an unusually public criticism of the department, which oversees US export controls on sensitive, high-tech goods.
The dispute comes amid scrutiny of Nvidia’s relationship with Megaspeed, whose website prominently advertises its partnership with the chipmaker. The company’s links to Nvidia have also emerged as a major issue following the resignation of CEO Jensen Huang.
Huang stepped down on Thursday after revelations of an affair with former Megaspeed executive Alice Huang, whom US intelligence suspects of being a Chinese spy, according to The New York Times. China has denied allegations of spying.
More from WorldCommerce Secretary Howard Lutnick has come under increasing scrutiny because of his reportedly close relationship with Huang. The Times reported Thursday that Lutnick resisted placing greater limits on the sale of Nvidia’s more advanced chips to China. Chinese firms have accessed Nvidia’s chips through companies like Megaspeed, which has purchased more than $4 billion worth of Nvidia’s advanced semiconductors.
The split in President Donald Trump’s cabinet reflects the widespread fallout from the scandal that has engulfed Nvidia, one of the most valuable publicly traded companies in the world. Nvidia’s computer chips play a central role in the buildout of artificial intelligence, powering AI models such as those developed by OpenAI and Anthropic.
The U.S. government has, since the Biden administration, sought to restrict the sale of the most advanced AI computer chips to China in an effort to protect U.S. technology companies’ lead. Yet China has at times retaliated, creating controversy over how far the U.S. should push its restrictions.
Bessent declined to comment Friday on the Times report that he confronted Lutnick last week in the White House’s situation room.
Separately, Axios reported this week that Lutnick received a classified memo this spring warning about Jensen Huang’s relationship with a suspected spy.
Numerous members of Congress have said they will investigate Lutnick’s actions and have called for him to testify on Capitol Hill.
On Thursday, Oregan Senator Ron Wyden and Massachusetts Rep. Richard Neal, both Democrats, wrote Lutnick a letter demanding that he preserve all records related to decisions about Nvidia chip exports, pending an investigation. Wyden and Neal are the top Democrats on the Senate Finance and House Ways and Means committees, respectively.
Trump’s approval of advanced Nvidia chip exports to China “raises critical questions about whether and to what extent political considerations are improperly influencing policy decisions made by the Administration,” Wyden and Neal wrote.
Republican Senator John Kennedy of Louisiana, a member of the Senate Banking Committee, also said he had questions for Lutnick and urged him to hold a press conference to explain what he knew.
“The Commerce Department greenlit $4 billion of sales of advanced chips to the company of the spy that Mr. Huang was having an affair with and I want to know why,” Kennedy said. “I want to know why the Commerce Department did it in light of the export controls, and everything I read indicates that this was a decision by the secretary himself.”
Kennedy said Lutnick should testify before the Senate and be subpoenaed if necessary.
Megaspeed was accused last year of illicitly shipping advanced Nvidia chips to China. In December, the company said there was “no evidence” of such exports.
On Thursday, Megaspeed said it took its obligations to comply with US export control laws “extremely seriously” and was committed to working “constructively and transparently” with the US government.
With inputs from agencies
