Treasury's Bessent says multiple agencies backed curbs on Megaspeed as Nvidia saga deepens

What Bessent said on CNBC

Treasury Secretary Scott Bessent told CNBC's Squawk Box that Treasury, Defense, State and the Office of the U.S. Trade Representative had for months advocated putting Megaspeed onto the entity list. He emphasized that the Commerce Department oversees export controls, adding, "and you will have to ask them about their internal processes." CNBC aired a 23:08 interview segment.

Reported friction over export controls

Axios reported that Bessent pressed Commerce Secretary Howard Lutnick in a White House Situation Room meeting last week about delays on export controls, particularly involving Megaspeed, and said Lutnick has "repeatedly stood in the way" of actions targeting companies alleged to funnel Nvidia's advanced AI chips to China. Asked on CNBC about that account, Bessent said, "We don't repeat conversations in the Situation Room." Commerce spokeswoman Kristen Eichamer told CNBC on Wednesday that Bessent and Lutnick had "no such conversation" in the Situation Room.

Chips, leakage and Megaspeed

Bessent said he is frustrated because "President Trump made it very clear that China should not receive any Nvidia chips above H100s," and he added that "any leakage is very frustrating" since it "hurts our great companies in the AI race [and] gives the Chinese an advantage." When pressed on whether Nvidia's top-end processors made it to China via the Singapore-based Megaspeed as an intermediary, he answered, "I think that there is a lot of leakage in the system, and we are constantly working to close that down."

He argued the focus should shift from personal scandal to compliance, saying, "The real story here should be: Did Nvidia know their client, and was there a robust effort at Nvidia to make sure that there was no leakage and that they were selling to what were obviously pass-through shell companies?" He added, "I think it's important that anyone at the company there be held accountable for that."

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Why this matters for your portfolio

Viewed as among Trump's closest corporate allies, Huang left his post as Nvidia CEO on Thursday after acknowledging an affair amid heightened attention to his relationship with Alice Huang, whom U.S. intelligence has reportedly deemed a Chinese spy. He had urged the U.S. government to relax limits on exporting advanced AI chips to China, and in December Trump stated that Nvidia could sell its H200 chips to authorized buyers in China so long as the U.S. receives a share of the sales.

The bottom line: Commerce still runs export controls while Treasury and others push to list Megaspeed, and Bessent is warning about chip "leakage" to China.

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