Nvidia espionage scandal: Bessent blames Commerce Department over Megaspeed chip leak

Bessent points at the Commerce Department

US Treasury Secretary Scott Bessent told CNBC that several US agencies had pushed for months to add Megaspeed to the list of restricted entities, and that the final decision belongs to the Commerce Department, which he said should be asked about its internal process. Bessent also said President Donald Trump had made clear that China should not obtain Nvidia chips more advanced than the H100. He described any leak of such chips as extremely frustrating, because it harms American companies in the AI race and gives China an advantage. Megaspeed had been investigated by US government agencies since last year on suspicion that it routed advanced Nvidia chips to China, but it has not been placed on the restricted list. Reports said pressure to list the firm existed while the department delayed the process.

An espionage case that reaches Jensen Huang

Jensen Huang stepped down as Nvidia chief executive after revelations about his relationship with Alice Huang, a former director of Megaspeed based in Singapore. US intelligence services reportedly treat her as a suspected spy working for Beijing, and suspect the relationship was used to extract trade secrets from him. Reports say Megaspeed bought Nvidia chips worth billions of dollars in recent years and used hardware purchases for data centres in Southeast Asia as cover to send chips to China. According to reporting based on an intelligence assessment, the allegations had been known for some time at senior levels of the Trump administration.

Congress and the White House turn on Lutnick

On Thursday, 12 November, angry Republican lawmakers asked Commerce Secretary Howard Lutnick to testify before Congress, while senior Democrats demanded that he preserve every document linked to the case. Republican Senator John Cornyn called for a thorough investigation into what he described as an outrageous bypass of national security export controls, and said heads should roll. Senator John Curtis accused Jensen Huang of gross negligence and questioned whether the department acts in the interest of American citizens. The Associated Press reported that White House officials are openly discussing whether Lutnick should be removed. Democratic leader Chuck Schumer demanded explanations from Huang, Nvidia and the Trump administration about what they knew and how they reacted.

Nvidia's donations and lobbying

The Washington Post published documents showing Nvidia gave $25 million toward building a new ballroom at the White House, initially asking to remain anonymous. Nvidia's lobbying spending rose sharply to $4.69 million in the first nine months of 2026, and the company set up its own political action committee in August 2026 to fund candidates. Democrats in the Senate and House asked the Commerce Department in writing to preserve all records of Nvidia's licence applications, which places the company's donations under scrutiny as well.

Hearings ahead

Senate Banking Committee chair Tim Scott asked Jensen Huang to testify before the committee on 3 December. Howard Lutnick agreed to testify voluntarily before the same committee on 10 December, after Scott sent letters to both men. Representative Darin LaHood, a member of the House committee on China, asked for Lutnick to explain what the department did and failed to do. Senator Pete Ricketts also requested explanations.