Bessent and Lutnick clashed at White House over handling of Nvidia customer Megaspeed: Report

WASHINGTON, DC: Treasury Secretary Scott Bessent reportedly confronted Commerce Secretary Howard Lutnick during a White House Situation Room meeting over delays in restricting a Singapore-based company suspected of helping divert advanced Nvidia chips to China. 

The reported clash came amid revelations involving former Nvidia CEO Jensen Huang and Alice Huang, a Megaspeed executive suspected by US intelligence of having links to Chinese intelligence. Bessent subsequently criticized the Commerce Department, raising questions about the administration’s handling of export controls intended to protect sensitive American technology.

Scott Bessent reportedly confronted Howard Lutnick over delayed Megaspeed restrictions at White House meeting

According to a report by Axios, Bessent challenged Lutnick during a meeting attended by Defense Secretary Pete Hegseth, Secretary of State Marco Rubio, and US Trade Representative Jamieson Greer. The discussion centred on why the Commerce Department had not placed Megaspeed International on the Entity List, which restricts companies considered a national security risk from accessing certain US goods and technologies.

The report, based on interviews with six senior sources briefed on or present during the discussions, said that other officials supported Bessent's position. Lutnick reportedly responded that he needed to consult President Donald Trump, prompting another official to suggest that the restrictions be implemented immediately.

The officials then reportedly met Trump in the Oval Office. After consulting technology adviser Elon Musk, the president reportedly approved proceeding with the restrictions and said, "Let's get it done."

However, Lutnick subsequently said, "I'll develop some options and come back," according to the report. Other officials reportedly responded that the decision had already been made and instructed him to "go execute."

The report also noted that Lutnick had previously resisted efforts to impose restrictions despite Trump's approval on at least three occasions, in May, August and November. A highly classified intelligence memo warning about Huang's relationship with the Megaspeed executive suspected of being a Chinese intelligence asset was reportedly shared with Trump and other senior officials in May.

Megaspeed, which is reportedly among Nvidia's major customers, is suspected of purchasing advanced chips for data centres in Southeast Asia before routing them to Chinese companies. Reports said that the company traded more than $4 billion worth of Nvidia chips over two years.

Scott Bessent blames Commerce Department as Howard Lutnick faces congressional scrutiny

Bessent addressed the export-control dispute during an appearance on CNBC's 'Squawk Box', saying several government departments had supported adding Megaspeed to the trade blacklist for months.

"But Commerce has the pen," Bessent said, referring to the department's authority over export restrictions. The treasury secretary directed further questions about the decision-making process to the Commerce Department and the Bureau of Industry and Security.

Bessent also said he was "frustrated" because Trump "made it very clear that China should not receive any Nvidia chips above H100s." "Any leakage is very frustrating because it hurts our great companies, and in the AI race gives the Chinese an advantage," he said.

A Commerce Department spokesperson, Kristen Eichamer, denied that Bessent had confronted Lutnick and defended cooperation between the departments. "The Department of Commerce and the Department of the Treasury have a great working relationship and are committed to advancing President Trump's agenda," she told Fox News.

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