US commerce secretary Howard Lutnick faces pressure and a possible firing over his department's reported delay in blacklisting Megaspeed, a firm tied to an alleged Chinese spy. The scandal already cost Nvidia chief Jensen Huang his job. Lawmakers from both parties now want answers and tighter chip export limits.
White House officials are discussing whether Lutnick should be fired, the Associated Press reported. Criticism centers on the commerce department's reported delay in adding Singapore-based Megaspeed to Washington's blacklist of companies the US considers a national security risk.
Megaspeed is associated with Alice Huang, who is suspected to be a Chinese spy, and has bought billions of dollars of Nvidia chips in recent years. Alice Huang is no relation to Jensen Huang.
Huang resigns after reports of affairs
Jensen Huang resigned from Nvidia on Thursday. Chief financial officer Colette Kress replaced him on an interim basis after reports emerged of multiple affairs, most importantly with Alice Huang.
A US intelligence report warning about that relationship circulated among senior figures in the Trump administration. Nvidia's board statement on the departure did not mention the spying scandal and instead praised Huang's contributions.
Congress demands accountability
Republican senator John Cornyn told the Financial Times the circumvention of export controls demands a thorough investigation. According to Cornyn: "Heads should roll."
Senate banking committee chair Tim Scott, also a Republican, said he sent letters asking Lutnick and Huang to appear before him. A Lutnick spokesperson told NBC News that he has agreed to appear voluntarily before the banking committee.
Meanwhile, Senate Democratic leader Chuck Schumer said Huang and Nvidia must answer whether America's security was jeopardised. House Democratic leader Hakeem Jeffries said he had demanded a classified briefing for all members of Congress about Nvidia.
Chip export limits gain support
House speaker Mike Johnson said there is a developing consensus in Congress on limiting chip exports to China. Lawmakers are pressing colleagues to pass at least four bills on chip exports, according to statements issued since Monday.
Chinese AI companies are now trying to secure Nvidia chip capacity outside China, people familiar with the matter told Reuters, amid concern that the gap in US export controls may now close.
Source: The Guardian
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