US Treasury Probes Nvidia Chip Sales to China Shell Companies

Treasury Secretary Blames Commerce Department for Megaspeed Chip Leak, Questions Nvidia’s Due Diligence

U.S. Treasury Secretary Scott Bessent has publicly assigned responsibility to the Commerce Department for the prolonged delay in adding Megaspeed to the entity list, marking the first time he has done so. Speaking on CNBC’s “Squawk Box,” Bessent also raised questions about Nvidia’s knowledge of its own customers.

Megaspeed, a Singapore-based company, has purchased over $4.8 billion worth of Nvidia’s advanced AI chips in the past two years. This development follows Nvidia CEO Jensen Huang’s admission of an extramarital affair with Megaspeed executive Alice Huang, which led to Huang’s resignation as CEO on November 12th.

According to the CNBC interview, Bessent stated that the Treasury, Defense, State departments, and the Office of the U.S. Trade Representative had “agreed for months to put Megaspeed on the entity list” – the Commerce Department’s blacklist for export controls. However, he emphasized that the Commerce Department holds the lead role in this process, suggesting that inquiries into the internal procedures of that department are warranted.

Bessent expressed “frustration” over the alleged chip diversion, noting that former President Trump had explicitly stated that Nvidia chips at the H100 level and above should not be sent to China.

He also sought to shift the focus from Huang’s personal conduct. “So far, the focus has been on Jensen’s personal failings,” Bessent remarked. “The real question is, does Nvidia know who its customers are, and is it seriously preventing diversion, or is it selling to companies that are clearly shell companies for resale?” He believes that individuals within the company responsible for these issues should be held accountable.

Records from the Federal Register indicate that the Commerce Department’s Bureau of Industry and Security (BIS), which oversees export controls, last added to the entity list on October 9, 2025, with no additions for over a year afterward.

Following the U.S.-China summit at the end of October 2025, Bessent himself stated in a Fox Business interview that the U.S. had paused for one year a rule concerning the entity list that would “restrict Chinese companies from buying controlled technology through affiliated companies.” This rule was originally set to resume on November 9, 2026, but BIS announced on that same day an extension of the pause until January 10, 2027.

CNBC reported that Senate Banking Committee Chairman Tim Scott sent a letter on the evening of November 12th, requesting Huang to appear at a hearing on December 3rd, and Lutenik on December 10th.

Additionally, three House committees have requested Huang to attend a closed-door briefing on December 1st. Nvidia’s General Counsel and Commerce Under Secretary for Industry and Security, Jeff Kessler, have also been invited.

These December hearings will mark the first time Nvidia is required to account before Congress regarding the identities of its customers.