Treasury Secretary Scott Bessent reportedly confronted Commerce Secretary Howard Lutnick at a White House meeting last week, demanding to know why Commerce never blacklisted Megaspeed, as reported by Politico. Megaspeed is a Singapore-based firm linked to chip-smuggling and spying allegations. The fallout from the Nvidia espionage scandal has now spread to the Commerce Department, and Lutnick is facing heat from his own party. More than half a dozen Republicans have demanded accountability from Lutnick and his top deputies over whether the agency put private tech interests ahead of national security by allowing sales of advanced AI chips. Sen. John Kennedy of Louisiana said, “The obvious question is why did he choose to sell advanced chips? Secretary Lutnick needs to answer that in front of God and country. If I were he, I’d call a press conference this afternoon and explain what happened and why he agreed to sell ’em chips, and I would stop doing it.” Lawmakers are pointing to reports that Commerce officials handed an investigation into Megaspeed to the Justice Department only after Nvidia’s general counsel asked for information about the probe. The agency involved is the Commerce Department’s Bureau of Industry and Security, or BIS, which manages blacklists of foreign companies barred from acquiring American technology. Republicans want answers from Commerce Rep. Bill Huizenga said the agency has not responded to requests for briefings, which he called frustrating. BIS spokesperson Thomas Wackman said the agency keeps a strong relationship with Congress and that scheduling details are best left to office staff. Axios, a frequent conduit for placing official US leaks, reports citing six sources, that President Trump has approved cracking down on companies suspected of funneling Nvidia AI chips to China three times this year, in May, August and on Nov. 5, but Commerce Secretary Howard… https://t.co/v3K8byfeHj— Drop Site (@DropSiteNews) November 12, 2026 The administration is also negotiating with lawmakers over three proposals to tighten chip restrictions, which could be included in the annual defense authorization bill. One of them, the AI Overwatch Act introduced by Rep. Brian Mast, would give Congress the power to review sales of advanced chips to adversaries. The scrutiny also extends to Jensen Huang, who reportedly had an affair with a Megaspeed executive suspected of being a Chinese asset. After reports on Wednesday claimed that Huang had a second affair with an Nvidia employee, he resigned as Nvidia’s CEO, the company’s board said on Thursday, per CNN. President Donald Trump, who has reportedly turned to Huang for tech policy advice, defended Huang after the affair first came to light. Lawmakers in both parties have pushed to investigate Nvidia over the scandal. Mast and Rep. John Moolenaar said they were ready to subpoena Huang if he did not respond to their request for a closed-door briefing by the end of the day on Wednesday. Speaker Mike Johnson said the administration is looking into the situation but declined to comment further until more facts are available.