White House weighs Lutnick's future as Nvidia chip scandal engulfs Commerce

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White House officials are discussing whether Commerce Secretary Howard Lutnick should be pushed out. The Nvidia China chip scandal has put his department's year-long export-control freeze at the center of a bipartisan storm.

Senior White House officials are weighing whether to push Commerce Secretary Howard Lutnick out of his job, according to two people familiar with the matter, as the Nvidia China chip scandal engulfs the department that decides what advanced American technology reaches Beijing

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. No decision has been announced, per the reporting, and Lutnick remains in post.

Source: New York Post

Source: New York Post

The discussions began the same day Jensen Huang resigned as chief executive of Nvidia, the dominant US AI chipmaker he co-founded

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. Huang stepped down Thursday under pressure from the board, per HuffPost, after word spread of an affair with Alice Huang and then of relationships with subordinates

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. Alice Huang, no relation to Jensen, is a top executive at Singapore-based Megaspeed International, and US authorities suspect her of spying for China

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. Per the Times, Nvidia's statement did not address his actions, and its shares fell on the news

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Source: Japan Times

Source: Japan Times

The company at the center of it

Megaspeed has spent more than $4.8 billion on Nvidia's top AI chips since June 2024, and US authorities suspect it of illegally diverting them to China

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The spy allegation is not new inside the government. This spring, Secretary of State Marco Rubio oversaw a classified assessment based on surveillance of Alice Huang. Beijing, the assessment found, may also have wanted Nvidia steered toward lobbying for greater access. Lutnick was among the senior officials who received the memo before Trump's May trip to China

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. The allegation remains just that. Attorney General Todd Blanche said Thursday the Justice Department has reached no conclusion on whether Alice Huang is a spy, and China denies she is one

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'Commerce has the pen'

Commerce has not added a single company to the Entity List, the US blacklist of firms barred from buying sensitive American technology, since October 2025. The freeze is the longest gap between additions in more than a decade, per Reuters reporting. The State Department, Treasury, Energy and the Pentagon repeatedly proposed adding Megaspeed and dozens of other Chinese firms, including DeepSeek and Changxin Memory Technologies

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Treasury Secretary Scott Bessent said Thursday that Treasury, War (the Pentagon), the US Trade Representative's office and State had all favored listing Megaspeed for months, "but commerce has the pen." He said he was frustrated by any leakage of Nvidia chips above the H100 to China

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. Axios reported that Trump approved a crackdown on chip diversion three times, in May, August and again on November 5. Lutnick and his deputies resisted carrying out each order, per that account, while virtually every other official supported it

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The Megaspeed probe itself stalled in 2025, per the New York Times. Commerce's own agents had opened it in 2024 under Biden. In 2025 Nvidia's general counsel emailed the agents citing permission from export-control chief Jeffrey Kessler. Per Fortune, the investigation was soon paused; the Times reports it was abruptly transferred to the Justice Department, which would not comment

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. Reuters has reported that Commerce avoided the additions for fear of escalating tensions with Beijing. Lutnick's public rationale was that the US should sell Chinese developers enough advanced chips to get them "addicted to the American technology stack"

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. Chris McGuire of the Council on Foreign Relations put it bluntly: "The real scandal here is the lack of enforcement of export controls." Commerce knew for about a year that Megaspeed was run by a suspected spy, he said, "and they did nothing"

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The president's cover

Trump has publicly stood by Lutnick, telling Hugh Hewitt the intelligence assessment of Alice Huang "didn't make much of an impact on me" and calling Jensen Huang "going through hell" and "a tremendous talent"

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Source: HuffPost

Source: HuffPost

Trump's own record complicates the blame story: he authorized Nvidia to sell its most advanced chips to China in December 2025, with the government taking a share of the revenue

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. Reuters reported that Commerce cleared about 10 Chinese companies to buy them in May

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. He was briefed on intelligence suggesting Alice Huang was a Chinese asset about a year ago, per the Times' reporting, and has admitted he ignored the warnings

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. Huang was also a Trump ally who, HuffPost reported, donated $25 million to the president's ballroom project while lobbying to loosen chip restrictions

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The dates are already set

Senate Banking Committee chair Tim Scott sent letters Thursday asking Lutnick and Jensen Huang to testify, said he would consider subpoenaing Huang, and scheduled a public hearing for December 3. In his letters, he cited "serious concerns about our national security and the protection of sensitive US technology"

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. Three House Republican chairs have asked Huang for a closed-door joint interview on December 1

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The criticism crosses party lines. Senator John Kennedy asked how officials know the chips went to Megaspeed "and not to the Communist Party of China." Lutnick, he said, "needs to answer that in front of God and country"

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. Senator Tom Cotton has urged barring the memory-chip maker from the US market, and Representative Brian Mast wants Congress to investigate Commerce's role in approving exports

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. Incoming Democratic chairs Elizabeth Warren and Chris Coons have demanded preservation of all documents on Nvidia's China exports. They take committee gavels in January, with subpoena power

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A White House official said this week that the president "maintains complete confidence in the secretary and his ability to carry out the position"

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. Lutnick is scheduled to testify before the Senate Banking Committee on December 10

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