Bessent: “We Backed Sanctions” ... Shifts Blame to Lutnick

[Financial News, New York—Correspondent Lee Byung-cheol]  The affair scandal involving former NVIDIA CEO Jensen Huang and a person suspected of being a Chinese spy is escalating into a rift within the Donald Trump administration. U.S. Treasury Secretary Scott Bessent blamed Commerce Secretary Howard Lutnick for delays in imposing semiconductor export controls on companies linked to a person suspected of being a Chinese spy. Calls in Congress for Lutnick to explain himself are also growing, and the fallout is expected to widen.
On the 13th (local time), Secretary Bessent said in an interview with CNBC regarding export controls on Singapore-based Megaspeed, “The Treasury Department, the Defense Department, the State Department and the Office of the United States Trade Representative (USTR) had all supported adding Megaspeed to the Entity List for months.”
He added, “However, the final decision rests with the Commerce Department,” and said, “You would have to ask them directly what procedures were followed within the department.” He was publicly pointing to the Commerce Department as responsible for the delay in sanctions against Megaspeed.
Axios previously reported that Secretary Bessent had pressed Secretary Lutnick in the White House Situation Room last week, asking why he was blocking sanctions on companies, including Megaspeed, suspected of rerouting advanced artificial intelligence (AI) chips to China. Lutnick had repeatedly blocked export controls on the companies, the report said.
The Commerce Department denied the report, saying no such conversation had taken place between the two secretaries. But when asked about it, Secretary Bessent replied, “We do not disclose conversations that take place in the White House Situation Room,” without clearly denying the reported clash.
Secretary Bessent also expressed strong dissatisfaction over the possibility of semiconductors leaking to China. He said, “President Trump made it clear that China should not receive semiconductors more powerful than NVIDIA’s H100. It is very disappointing that chips are leaking despite that.” He went on to emphasize, “This harms U.S. companies in the AI race and gives China an advantage.”
Megaspeed, at the center of the controversy, is a Singapore-based company where Alice Huang, who had an extramarital relationship with former CEO Huang, worked as an executive. U.S. authorities suspect that Alice Huang may have worked for Chinese intelligence agencies. The U.S. government has been investigating for more than a year whether Megaspeed smuggled NVIDIA’s advanced AI chips into China.
Congress is also putting pressure on Secretary Lutnick. Republican lawmakers have called for him to appear before Congress and testify, while Democratic leaders have urged the Commerce Department to preserve documents related to the case in preparation for an investigation.


[email protected] Correspondent Lee Byung-cheol Reporter