White House advisers blame Commerce Secretary Lutnick for Nvidia fallout

Republican senators seek Lutnick testimony as Democrats open Nvidia investigation

Some of President Trump’s top advisers have started shifting blame for the political mess toward one man: Commerce Secretary Howard Lutnick, according to people familiar with the discussions.

Lutnick has been a primary target of the finger-pointing within the administration because of his efforts to stall restrictions on chip exports, his longstanding relationship with the outgoing Nvidia chief executive and his pre-existing tensions with some members of the administration, those people said.

The pressure on Lutnick shows that the tentacles of the Huang scandal are reaching into the president’s cabinet. On Thursday, some of Trump’s advisers discussed how to deal with the mounting internal criticism of Lutnick, the people said. Some of Trump’s political allies have previously raised with the president the idea of ousting the Commerce secretary, some of the people familiar with the matter said.

The White House, in a statement, said Trump “maintains complete confidence in the secretary and his ability to carry out the position as the most transformative Commerce Secretary in modern history.” The White House didn’t respond to requests for additional comment. Representatives for the Commerce Department and Treasury Department didn’t respond to requests for comment.

Lutnick’s critics say his agency has hindered efforts to crack down on shipments of U.S. artificial-intelligence chips to Southeast Asia, creating an opening for executives such as suspected Chinese intelligence source Alice Huang to do business with Nvidia. Her company was one of several suspected of providing computing power to China’s tech industry.

Some political allies of the president have told Trump and his senior advisers that Lutnick has been giving cover to Nvidia and Huang through what they view as a lack of action on export controls. Commerce oversees export controls, but its decisions are approved by other agencies, including the Treasury Department.

Trump himself opposed tight export restrictions, largely mirroring Huang’s argument that it was more important to keep Chinese firms hooked on U.S.-made chips. He was also informed of Huang’s affair but declined to take action.

Some of the president’s senior advisers have long expressed frustration with Lutnick. They have blamed him for the chaotic rollout of tariffs last year and for helping Huang and other tech executives get close to the president. Some have accused him of allowing the financial services firm he previously ran before handing it over to his sons, Cantor Fitzgerald, to benefit from some of the policies Commerce oversees. The firm has denied receiving preferential treatment.

The battle between Lutnick and others in the administration boiled over during a recent meeting in the Oval Office, according to people familiar with the matter. At the meeting, Treasury Secretary Scott Bessent and senior administration officials took on Lutnick over his agency’s failure to restrict the sale of Nvidia’s chips to China and other countries posing security concerns. Axios earlier reported on the meeting.

The two cabinet secretaries have clashed sporadically since the presidential transition period after Trump’s 2024 victory, when both were vying to become Treasury secretary.

As the scandal around Huang has raised questions about the administration’s dealings with Nvidia, officials including Bessent have tried to cast blame on Lutnick, according to people familiar with the matter. Others in the administration pointed the finger back at Bessent, noting that the Treasury Department hasn’t sanctioned Alice Huang or her former company, Megaspeed International.

Lutnick is also facing scrutiny from congressional lawmakers from both parties.

Sen. Thom Tillis (R., N.C.) told reporters on Thursday that he wants Lutnick to testify to Congress and blamed the commerce secretary for allowing Huang to get close to the president despite the chip executive’s ties to a suspected spy. “Shame on Lutnick for allowing that exposure to happen for the president,” Tillis said.

Sen. Jim Banks (R., Ind.) told Fox News that it appeared Lutnick had been “defying President Trump’s orders” by declining to impose chip-export restrictions. Sen. John Kennedy (R., La.) said he was prepared to bring Lutnick to testify in front of Congress.

Democrats are gearing up for a fight with Lutnick once they officially take control of Congress next year. Sen. Ron Wyden (D., Ore.) and Rep. Richard Neal (D., Mass.), who are both expected to chair key congressional committees, co-authored a letter to Lutnick announcing their investigation into the Trump administration’s dealings with Nvidia. The two Democrats requested Lutnick preserve records for their probe.

The Commerce Department, meanwhile, has rushed to show progress on restricting chip exports after a series of damaging news reports, advancing a new rule to limit such shipments to Southeast Asia, people familiar with the matter said.

Under the new Bureau of Industry and Security rule being finalized, seven countries would be added to a group currently subject to export restrictions and licensing requirements, including Malaysia, Thailand, Indonesia and Singapore — countries that have hosted data centers accessed remotely by Chinese customers, the people said.

The Commerce Department had been investigating Megaspeed, where Alice Huang was a top executive, for potentially violating chip-export-control rules since 2024, but stopped short of blacklisting the company. That frustrated officials at the State Department and in the National Security Council, the Journal previously reported. The Justice Department is now leading multiple probes involving Alice Huang, people familiar with the matter said.

The commerce secretary was one of the Trump administration officials closest to Jensen Huang, frequently consulting him on AI policy decisions and praising him as one of America’s great executives. “Howard is the person I talk to most in the administration,” Huang said last year. The Commerce Department posted a clip of his remarks on its social-media page.

Lutnick often appeared with Jensen Huang in videos shared on social media and at public events, including a September G-20 tech summit in North Carolina featuring many tech executives and other officials.

Lutnick consulted Huang on many of his biggest decisions affecting the tech industry. When Lutnick was attempting to stabilize troubled chip maker Intel last year, he talked to Huang and other executives about doing more business with the company. Nvidia later invested $5 billion after the government took a roughly 10% stake.

When others in the Commerce Department or other agencies pushed for actions targeting Megaspeed or other companies linked to China, Lutnick would often stall or push back, telling colleagues that Beijing would get angry and scuttle trade talks or hurt the U.S. economy, people familiar with the comments said.

A Commerce official said that Lutnick and Huang don’t have any kind of special relationship beyond the commerce secretary wanting a good rapport with one of the most important U.S. companies. Lutnick and Huang met almost quarterly, according to a person familiar with his schedule.

A Commerce Department official noted that Lutnick has survived previous campaigns to oust him, saying the president stood behind his longtime friend amid controversies over the administration’s trade policies and Lutnick’s connection to the late Jeffrey Epstein.