Lutnick's Commerce Future Reviewed After Nvidia Spy Scandal

Senior White House officials are discussing whether Commerce Secretary Howard Lutnick should be pushed out in the wake of the spy scandal surrounding Nvidia's now-former CEO Jensen Huang, Reuters reported. A White House official said President Donald Trump "maintains complete confidence in the secretary and his ability to carry out the position."

The pressure built over Commerce's refusal to add dozens of Chinese companies to a key US trade blacklist, and over whether the government was properly overseeing Nvidia's exports to China. A growing number of lawmakers have criticized Lutnick on both points. Huang announced he would step down after revelations of an affair with Alice Huang, whom US authorities suspect of spying for Beijing.

The internal friction had already surfaced days earlier. Axios reported that at a Situation Room meeting after the midterm elections, Treasury Secretary Scott Bessent pressed Lutnick on why Nvidia customer Megaspeed had not been added to the Commerce Department's entity list, and that Lutnick initially stammered before replying, "I don't know. I'll look into it." Commerce spokesperson Kristen Eichamer disputed the account: "This is false. Secretary Bessent and Secretary Lutnick had no such conversation."

Megaspeed is a Singapore-based company originally incorporated in 2015 as a Chinese video game developer called 7Road International. In the three years since Alice Huang became director and the company changed its name, it has become one of the largest buyers of Nvidia chips in Asia, purchasing more than $4 billion worth of its semiconductors, by some analyst estimates. Commerce has not added a single company to its Entity List in more than a year, according to a review of the Federal Register. Democratic Senator Elizabeth Warren said "Secretary Howard Lutnick and undersecretary Jeffrey Kessler must explain why they have not closed export control loopholes and act today to ensure our advanced technology is not fuelling China's military."

The story lands alongside our note the same day on the department's upcoming rule to block China's remote AI chip access, with the same secretary's name attached to both.