Bessent Confronts Lutnick Over Failure to Blacklist Megaspeed

According to a source briefed on the meeting, Bessent asked: “How come Megaspeed isn’t on the entities list?” Lutnick initially stammered, sources told Axios, and then replied: “I don’t know. I’ll look into it.”

The exchange took place on Thursday, after the midterm elections, in the White House Situation Room. Maria Curi and Marc Caputo reported the account on Wednesday, citing sources familiar with the matter.

Pressure Inside the Building

Commerce Undersecretary Jeff Kessler was also repeatedly warned about Megaspeed in deputy meetings, Axios reported. White House and intelligence officials have pressed Lutnick and his senior advisers to take action against the Singapore-based company since the fall of 2025, the sources said.

Those officials refused, according to Axios, which is why Bessent raised the issue on Thursday. Sources told the outlet that Lutnick has spent the past year “undoing” efforts by other administration officials to hold Megaspeed accountable, over concerns that a crackdown would escalate the trade war with China.

Megaspeed, an Nvidia customer, has been accused of illegally diverting U.S. chips to China. The Entity List is the Commerce Department roster of firms that face tight restrictions on receiving sensitive American technology.

Agencies Push for a Blacklist

On Tuesday, the New York Times reported that Kessler abruptly stopped an investigation into Megaspeed after Nvidia intervened. The Financial Times has reported that Commerce was delaying a blacklist even as several other U.S. agencies pushed for one.

The Commerce Department oversees export controls on sensitive technologies, and Lutnick’s handling of the file is drawing closer scrutiny. Axios tied that pressure to recent revelations about Nvidia chief executive Jensen Huang and Alice Huang, a Megaspeed executive.

A Memo Before the China Trip

Lutnick was among the officials who received an intelligence memo in May, ahead of a trip to China, Axios earlier reported. The memo was overseen by Secretary of State and national security adviser Marco Rubio and, according to previous reporting, outlined problems with Megaspeed.

U.S. officials have assessed that Alice Huang is a suspected Chinese spy, the Times has reported. Huang later acknowledged an affair with the Megaspeed executive, and Nvidia’s board opened an independent review. Alice Huang is not related to the Nvidia chief.

Sources Dismiss Lutnick’s Reply

One source with extensive experience of the chip controversy dismissed Lutnick’s answer, telling Axios it was “bullshit,” because the commerce secretary had resisted action ever since he was personally handed the Rubio memo.

Axios did not report a comment from the Commerce Department, the Treasury Department or the White House on the Situation Room exchange.