Scott Bessent blames the Commerce Department for not cracking down on Megaspeed

Treasury Secretary Scott Bessent said it wasn't his department's job to crack down on Megaspeed and that reporters should ask Commerce Secretary Howard Lutnick why his department hasn't done so. Allison Robbert/AFP via Getty Images Treasury Secretary Scott Bessent said it wasn't his fault that the Trump administration hasn't cracked down on the company at the center of the Nvidia scandal."Commerce has the pen," Bessent said during an interview on CNBC on Friday morning, adding, "You all will have to ask them about their internal processes."Bessent's striking comments essentially threw Commerce Secretary Howard Lutnick and his department under the bus. It also follows an Axios report that Bessent confronted Lutnick during a meeting in the Situation Room about why the Commerce Department had not added Megaspeed, a Singapore-based cloud company, to the "entity list," a trade blacklist that Lutnick's department controls.Bessent said he would not comment on what happens in the Situation Room but also did not deny the report. A spokesperson for the Commerce Department did not immediately respond to a request for comment from Business Insider.Alice Huang was a top executive at Megaspeed. The New York Times has reported that US officials suspected she was a Chinese intelligence asset. The Times also reported that Alice Huang had an affair with then-Nvidia CEO Jensen Huang. Jensen Huang apologized in a note to employees for having an affair on Sunday, but did not mention Alice Huang or the espionage allegations. Nvidia's board announced on Thursday that Jensen Huang had resigned. China has repeatedly denied that Huang was a spy.Megaspeed, an Nvidia partner, is facing scrutiny over whether its data centers helped Chinese customers access advanced Nvidia chips despite US export restrictions. Bessent said that his department and his deputy had been "pushing for months" for the action against Megaspeed.Bessent said that "there is a lot of leakage in the system" and that Chinese companies are getting access to chips superior to Nvidia's H-100."President Trump made it very clear that China should not receive any Nvidia chips above H100S, and so any leakage is very frustrating, because it hurts our great companies in the AI race and gives the Chinese an advantage," he said.As for the Nvidia founder, Bessent said the focus should be less on Huang's reported affairs and more on how Nvidia's advanced chips are entering China. "The story has been thus far on Jensen Huang's personal foibles," Bessent said. "The real story here should be, did Nvidia know their client?"Bessent's comments underscore that Huang's ouster is far from the end of the controversy for Nvidia."Was there a robust effort at Nvidia to make sure there was no leakage, and they were selling to what were obviously pass-through shell companies?" Bessent said. "And I think it's important that anyone at the company there be held accountable for that." Read next Business Insider tells the innovative stories you want to know Business Insider tells the innovative stories you want to know Business Insider tells the innovative stories you want to know Business Insider tells the innovative stories you want to know Brent D. Griffiths Brent Griffiths is a senior reporter at Business Insider who covers AI and tech. Previously, he worked at the Washington Post. He started his career at Politico. Trade China