Commerce Secretary Howard Lutnick faces scrutiny over China chip sales
Treasury Secretary Scott Bessent accused the commerce department of delaying sanctions against a firm suspected of sending Nvidia chips to Beijing.
US Commerce Secretary Howard Lutnick is facing pressure following allegations that his department delayed sanctions against Megaspeed. According to a report by the Times of India, Megaspeed is accused of using a honeytrap operation to send advanced Nvidia AI chips to Beijing.
Treasury Secretary Scott Bessent told reporters on Thursday that the Departments of Treasury, War, USTR, and State had supported placing Megaspeed on the entity list for months. Bessent expressed frustration, stating that any leakage of chips hurts American companies and gives China an advantage.
Lutnick has previously argued that the United States should sell enough advanced chips to Chinese developers to make them dependent on the American technology stack. This approach aims to ensure China uses US software and infrastructure rather than building an independent ecosystem.
The issue has drawn criticism from lawmakers, including Republican Senator John Kennedy from Louisiana, who questioned how officials know the chips did not reach the Communist Party of China. While the White House stated President Trump maintains complete confidence in Lutnick, the matter is facing bipartisan Congressional scrutiny.
Nvidia CEO Jensen Huang has been asked to participate in a closed-door interview on December 1, with a public hearing before the Senate Banking Committee scheduled for December 3. Lutnick is expected to appear before the Senate Banking Committee on December 10.
