Democrats open inquiry into Trump's Nvidia chip deal with China

Two senior Democratic lawmakers opened an inquiry Thursday into the Trump administration's approval of Nvidia chip sales to China, and asked Commerce Secretary Howard Lutnick to preserve records on the decision 1

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. The move targets the administration's own export-approval process as well as Nvidia's conduct 1

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The CEO who left

The probe landed on the same day Jensen Huang left Nvidia, the company he founded and ran for decades 1

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. The two outlets characterize the departure differently, with TechCrunch reporting he was ousted and The Hill that he resigned 1

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. Both agree on the trigger: Huang admitted to an extramarital affair with Alice Huang, a former executive at Megaspeed 1

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. Megaspeed is a Singapore-based Nvidia customer that US officials suspect of helping route advanced chips into China 1

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. Alice Huang herself is suspected of being a Chinese intelligence asset 1

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. Those suspicions are so far only allegations 2

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. He has since faced additional accusations of affairs with Nvidia employees, which remain unconfirmed 1

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. The Hill has described Huang as among Trump's closest Silicon Valley allies, a relationship that had helped the company on export controls 2

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Huang has separately agreed to give closed-door testimony to Republican-led committees, including the House Select Committee on the Chinese Communist Party, after they threatened a subpoena. That demand came after his resignation and is the second congressional probe to grow out of the affair 1

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The alleged scheme

The Democratic letter, from Senator Ron Wyden and Representative Richard Neal, the ranking members on the Senate Finance and House Ways and Means committees, alleges a scheme. Trump allowed sales of Nvidia's H200 chip to China on condition that the Taiwan-made chips shipped to the US first. He then imposed a tariff taking a cut of the sales, with Commerce issuing the export license 1

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. "The scheme worked like this," the letter reads, describing "effectively taking a cut of Nvidia's sales to China through what appears to be an unconstitutional export tax system" 1

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. The unconstitutional label is the lawmakers' own legal argument 1

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Part of the arrangement was already public. In August 2025 Nvidia and Advanced Micro Devices agreed to hand the government 15% of their China chip-sale revenue to secure export licenses 1

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. Trump later cleared that same chip for a 25% cut late last year, after first restricting an earlier Nvidia model and then reversing course last summer 1

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. What is new is the legal argument about how that cut was taken. Wyden and Neal argue Trump stretched Section 232, a 1962 trade statute meant for imports posing a national-security threat, to do the opposite. "Trump's use of the statute appears to have done the opposite, undermining U.S. national security and putting Americans at risk," they wrote 2

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The due-diligence questions

The letter also asks why Lutnick kept approving Megaspeed as a buyer after reportedly being told by US intelligence about the suspicions around Alice Huang and Jensen Huang's relationship. It asks too why other Asian firms were cleared despite having no real presence at the addresses they listed 1

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. The intelligence warnings were reportedly delivered, and the agencies involved have not confirmed the underlying reports 1

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. Per the New York Times, Commerce approved dozens of Chinese firms to handle the chips, some with ties to sanctioned companies. It also paused its own Megaspeed smuggling investigation last year, reportedly handing it to the Justice Department; neither agency confirmed that account, and the department declined to comment 2

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The sharpest allegation in the letter concerns timing. It notes the export approval came after Trump learned of Huang's compromised position, and after Nvidia donated $26 million to Trump projects including the White House ballroom. The letter asks whether Trump used knowledge of the affair to extract the donations 1

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. Days before the probe launched, Trump told "60 Minutes" that his team threatened an unnamed AI executive with jail, after which the executive "totally changed" 1

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. The executive was not identified and no link to Huang has been confirmed 1

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The probe has real limits: Wyden and Neal can ask questions, but as the minority party they cannot compel any answers 1

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