Nvidia Email Shifts Commerce Megaspeed Chip Probe to Justice

A Commerce Department investigation into Singapore data-center company Megaspeed was transferred to the Justice Department after Nvidia’s general counsel contacted the agents working the case, The New York Times reported on Monday.

The shift followed an August 2025 email from Nvidia general counsel Tim Teter to Bureau of Industry and Security investigators. In that message, Mr. Teter said Under Secretary of Commerce Jeff Kessler had given Nvidia permission to reach out about the Megaspeed inquiry, people familiar with the incident told the Times.

Agents were alarmed that Nvidia had invoked Mr. Kessler, their superior and a Trump nominee who reports to Commerce Secretary Howard Lutnick. Some current and former officials viewed the contact as a potential breach of procedure that risked tainting the case.

After the email, Commerce officials notified partner agencies. The Justice Department asked Commerce to pause its work, and Commerce complied, one person familiar with the matter said. The Justice Department is now conducting a criminal inquiry into Megaspeed, according to people briefed on the matter.

Megaspeed, Alice Huang and the Board Inquiry

U.S. officials began examining Megaspeed and executive Huang Le, also known as Alice Huang, in 2024 after the firm imported billions of dollars in advanced Nvidia A.I. equipment into Malaysia for data centers serving Chinese clients, including Alibaba. Officials suspected some chips were illegally routed into China.

The Times reported last month that the U.S. government concluded Ms. Huang was a spy working for Beijing. On Sunday, Nvidia said it was opening an investigation into chief executive Jensen Huang after he acknowledged to the board that he had been intimate with Ms. Huang. The pair are not related.

Clash Report has covered Nvidia’s board probe into reports of spy targeting and earlier New York Times reporting that Huang was targeted by an alleged Chinese spy.

President Donald Trump was briefed in October 2025 that Ms. Huang had a relationship with Mr. Huang and was presumed to be a spy, but he chose not to act on that intelligence, the Times reported.

Official Responses

A Justice Department spokeswoman said the agency does not comment on continuing investigations. A Commerce Department spokesman said the department had been aggressively enforcing its rules and had handled this and other actions “strictly by the book.”

John Rizzo, a spokesman for Nvidia, said the company consults with officials “to answer their questions, provide information we have gathered from the field, request their guidance and instructions and ask whether they have any follow-ups.” He added that Nvidia works “to help government and our partners halt any would-be smugglers while serving the critical market of lawful customers that help America win worldwide.”

A Megaspeed representative said the company was conducting an internal investigation into chip-diversion allegations and had repeatedly offered to cooperate with the U.S. government, but those offers had gone unanswered. Mr. Kessler did not respond to requests for comment.

As an under secretary, Mr. Kessler would typically be walled off from investigative details because he might later serve as a neutral arbiter, officials said. His interactions with Nvidia could also become subject to discovery or a subpoena if the government pursued legal action against Megaspeed.

Entity List Stall

Other agencies have proposed placing Megaspeed on the Commerce Department’s entity list, a trade blacklist. The department has not moved forward and has not added any company to the list in over a year — the longest such stretch in 18 years, the Times reported.

Several officials questioned why Commerce was discussing the case with Nvidia while the company had not been ruled out as a subject of the investigation. Agents who had spent months building the Megaspeed case described the handoff as unusual and frustrating.