"I Don't Know": Bessent Confronted Lutnick Over Why Nvidia Spy Scandal Firm Isn't Blacklisted

The fallout from the now-unemployed Jensen Huang Nvidia spy scandal continues to spread. Now we learn that Treasury Secretary Scott Bessent reportedly confronted Commerce Secretary Howard Lutnick in the White House Situation Room on Thursday, Nov. 5, demanding to know why Megaspeed - the Singapore data center company whose former executive Alice Huang has been identified by US intelligence as a Chinese spy - still isn't on the Commerce Department's entity list, according to Axios, which first reported the exchange.

"How come Megaspeed isn't on the entities list?" Bessent asked, according to Axios' sources. Lutnick stammered, then answered: "I don't know. I'll look into it." One person familiar with the exchange called the answer "bullshit," and said Lutnick had resisted acting on the company ever since he received an intelligence memo about it.

People briefed on the meeting gave The New York Times the same account, adding that Lutnick told Bessent the Commerce Department could now move quickly to restrict Megaspeed.

Commerce spokeswoman Kristen Eichamer denied the whole thing: "This is false. Secretary Bessent and Secretary Lutnick had no such conversation." The department told the Times that adding a company to the entity list is a decision for the whole administration, not Commerce alone.

The fight spilled into the open a day before Jensen Huang resigned as Nvidia's president and chief executive on Thursday, effective immediately, with CFO Colette Kress named interim CEO. Huang told staff last weekend that he had been "unfaithful" to his wife, after reports that US intelligence believes he had a romantic relationship with Alice Huang (no relation), who helped run Megaspeed.

In a second scoop, Axios reported that Trump signed off on action against suspected Nvidia chip diversion three times this year - in May, in August and again in the Oval Office on Nov. 5 - and Lutnick held it up each time. "Let's get it done," Trump said at the Nov. 5 meeting, according to Axios' sources, while Lutnick warned that the controls "will start a trade war with China."

Megaspeed was incorporated in 2015 as a Chinese video game developer, 7Road International. Since Alice Huang became a director about three years ago and the company changed its name, it has become one of Asia's biggest buyers of Nvidia chips, with more than $4 billion in purchases by some analyst estimates. Washington has barred sales of advanced chips directly to China since late 2022, but Megaspeed and others have worked around the rules by building data centers in Southeast Asia that serve Chinese customers. US officials are also investigating whether Megaspeed smuggled chips into China outright, which the company denies.

Sen. Tom Cotton asked Lutnick in October 2025 to investigate Megaspeed, calling it a spin-off of the Chinese government-owned cloud company 7Road and pointing to chips routed through a subsidiary of sanctioned Chinese firm Inspur and near-empty offices in Malaysia and Singapore. Commerce also received a national security warning on Huang's relationship, and Axios says a classified memo on Megaspeed and Alice Huang reached Lutnick in May, ahead of Trump's trip to China.

As we reported, Commerce's own investigation of Megaspeed was halted after Nvidia's general counsel emailed the agents running it in August 2025; the case went to the Justice Department, where it is now a criminal inquiry. Other agencies have proposed adding Megaspeed to the entity list, but Commerce hasn't added a single company to it in more than a year, according to the Federal Register.

In its first statement since the scandal broke, signed by chairman and CEO Tan Yong Pong, also known as James Tan, Megaspeed said Thursday that it had cooperated with Commerce inspections and "stands ready to cooperate fully with any other relevant U.S. government authority," NBC News reported. It said it had hired a US law firm to count every GPU it holds and check its export compliance. It did not address Alice Huang. Singapore says its own criminal probe of Megaspeed and six others over server shipments is still going.

House Republican committee chairs have already asked Huang to sit for a closed-door briefing on Nov. 18. Democrats take both chambers in January, and with them the subpoena power to ask Lutnick the same question Bessent did.

Meanwhile, Sen. Elizabeth Warren (D-MA) said on Thursday that Huang's resignation "does not absolve him" and that he and other Nvidia execs "still owe Congress answers about the company’s compliance with U.S. export controls."

Popcorn time...