Critics Charge Lutnick Failed to Prevent Diversion of Nvidia AI Chips to China

Commerce Secretary Howard Lutnick is facing bipartisan scrutiny following the resignation of Nvidia CEO Jensen Huang, with lawmakers demanding answers regarding the Commerce Department’s oversight of advanced AI chip exports to entities linked to China.

Senate Banking Committee Chairman Tim Scott has formally requested that both Lutnick and former Nvidia CEO Jensen Huang appear for a public hearing on December 3.

Nvidia CEO Jensen Huang on Secretary Howard Lutnick’s role in America leading the AI revolution: “Howard is the person I talk to most in the administration—he’s on top of the technology and learning the industry quickly. I announced a historic partnership today, and he was the… pic.twitter.com/ts9yYPb9FC

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Further legislative oversight is planned, as three House committees—led by Brian Mast of the Foreign Affairs Committee, John Moolenaar of the China Select Committee, and Rick Crawford of the House Intelligence Committee—have requested Huang and Nvidia General Counsel Tim Teter appear for hearings on December 1 and 2, or face subpoenas. Under Secretary of Commerce Jeffrey Kessler has also been summoned for a December 3 hearing.

While the company’s board confirmed the departure, oversight plans are intensifying; Senate Democratic leader Chuck Schumer said that both Nvidia and the Trump administration must account for what they knew once intelligence regarding the relationship surfaced.

NEW: The world is wondering why the Trump administration has not taken action against the company at the center of suspected Nvidia chip smuggling and an espionage scandal involving CEO Jensen Huang. Six high-level sources all pointed to one administration official who they say…

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Critics, including Democratic Sens. Elizabeth Warren and Chris Coons, have accused the Commerce Department of failing to restrict the flow of advanced semiconductors. Reports suggest that Megaspeed, which purchased over $4.8 billion in chips, served as a conduit to bypass U.S. export controls.

Further, reports indicate that while the Commerce Department was finalizing a rule to close a loophole allowing remote access to Nvidia chips in Southeast Asia, the implementation faced delays.

Nvidia’s Huang, Lutnick summoned to testify to US Senate — Photo: Al Jazeera

The scrutiny extends to the White House, where officials are reportedly debating Lutnick’s future. Despite the backlash, a White House official said that President Donald Trump “maintains complete confidence in the secretary and his ability to carry out the position as the most transformative Commerce Secretary in modern history.”

Reports suggest that while President Trump ordered a crackdown on companies diverting AI chips to China, Lutnick slowed the execution of these orders. Some lawmakers, including Sen. Ruben Gallego, have accused the Secretary of having “sold out our national security to keep the stock market high.”

He sold out our national security to keep the stock market high. https://t.co/pt3s7lJT31

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Legislators are now pushing for document preservation as they prepare for investigations. Sens. Investigations are also centering on whether Lutnick’s personal financial background, including his former role at BGC Group and its stake in a joint venture with China Credit Trust, influenced his decision-making.

As the Commerce Committee prepares for testimony, some Republicans, such as Sen. Jim Justice, have urged colleagues not to rush to judgment, stating, “We don’t need to shoot Howard today.” Meanwhile, the Commerce Department continues to face pressure to clarify why, despite intelligence warnings, it did not take action to curb chip smuggling to companies flagged as national security risks.