US Treasury Secretary Criticizes Commerce Department Over Nvidia Chip Export Failures

US Treasury Secretary Scott Bessent criticized the Commerce Department on November 14, 2026, for failing to restrict the export of Nvidia chips to Singapore-based Megaspeed International. The criticism follows allegations that Megaspeed International has been involved in smuggling advanced semiconductors to China. The Commerce Department, which is led by Secretary Howard Lutnick, maintains final authority over the export-control list.

Investigation into chip smuggling

The Bureau of Industry and Security within the Commerce Department began investigating Megaspeed International in 2024. During a two-year period, Megaspeed International reportedly purchased more than $4 billion worth of Nvidia semiconductors. US intelligence officials suspect Alice Huang, a former executive at Megaspeed International, of working for the Chinese government.

Scott Bessent stated that the Treasury, Defense, State, and US Trade Representative departments have supported the blacklisting of Megaspeed International for several months. The Treasury Secretary noted that any leakage of advanced chips is frustrating because it disadvantages US companies in the artificial intelligence race. Scott Bessent further stated that the Commerce Department holds authority over exports and must be questioned regarding its internal processes.

Leadership changes and executive scandal

The investigation coincides with significant leadership changes at Nvidia. Nvidia CEO Jensen Huang resigned on November 13, 2026, following revelations of extramarital affairs. These revelations included a relationship with former Megaspeed executive Alice Huang. Axios reported that Secretary Howard Lutnick received a classified memo in the spring regarding the relationship between Jensen Huang and Alice Huang.

The New York Times reported that Secretary Howard Lutnick resisted tighter restrictions on the sales of advanced Nvidia chips to China. While some reports suggested a confrontation between Scott Bessent and Howard Lutnick occurred in the White House Situation Room, a Commerce Department spokesperson, Kristen Eichamer, denied these reports. The investigation into whether Megaspeed International engaged in illegal smuggling or intentionally bypassed existing controls remains ongoing.

National security and export controls

The US government maintains strict controls to prevent China from accessing Nvidia processors that are more advanced than the H100 model. President Donald Trump has previously identified the H100 as the limit for Chinese exports. The current scrutiny highlights the tension between enforcement of national security protocols and the commercial interests of semiconductor manufacturers.

Both Jensen Huang and Howard Lutnick are expected to testify before Congress in December 2026. These testimonies will likely address the efficacy of current export controls and the oversight of companies suspected of bypassing US trade restrictions. The outcome of these hearings will be critical for future US policy regarding advanced semiconductor technology and international trade security.

Glossary

• Commerce Department — The United States Department of Commerce (DOC) is an executive department of the U.S. federal government. It is responsible for gathering data for business and governmental decision making, establishing industrial standards, catalyzing economic development, promoting foreign direct investment, and safeguarding national economic security.
• Bureau of Industry and Security — The Bureau of Industry and Security (BIS) is a part of the US Department of Commerce. It utilizes the Entity List as a tool to restrict the export, reexport, and transfer of items subject to the Export Administration Regulations.
• White House Situation Room — The White House Situation Room is a location used for communications with the Pentagon.
• H100 — The H100 is a model of advanced processor. The US government maintains strict controls to prevent China from accessing processors that are more advanced than this model.