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NVIDIA's general counsel emailed Commerce investigators about Megaspeed before the chip-diversion case went to the Justice Department, the New York Times reported. NVIDIA says it works with officials to stop smuggling.
Chips & Power DeskEdited by Ege Erten
3 min readAI-assisted
Follows our story: NVIDIA Board Opens Independent Probe Into CEO Jensen Huang Spy Reports
An NVIDIA data-center GPU board from NVIDIA's product page. It is an illustrative product image: the reports do not identify which chips Megaspeed handled.
Image: NVIDIA
Source · Press image from the NVIDIA website, used for news reporting.
A Commerce Department probe into Megaspeed, a Singapore data-center company suspected of diverting NVIDIA AI chips to China, was moved to the Justice Department after NVIDIA's general counsel contacted the agents on the case, The New York Times reported on Nov. 9, according to Investing.com and Seeking Alpha.
General counsel Tim Teter emailed Commerce investigators in August 2025 seeking information about the Megaspeed inquiry, Investing.com said, citing the Times. In the email he said senior Commerce official Jeff Kessler had given him permission to reach out. Kessler oversees the department's export-control operations and reports directly to Commerce Secretary Howard Lutnick.
This follows the board inquiry we covered on Nov. 8. As Voltgrid reported, NVIDIA's board opened an independent investigation after reports that CEO Jensen Huang was targeted by a foreign intelligence effort. The new report concerns a different question: how the company dealt with the officials investigating one of its customers.
The investigators declined NVIDIA's request for a meeting and were reportedly alarmed by the reference to Kessler. After receiving the email chain, Kessler told them to keep handling the case strictly by the book, a Commerce Department official told the Times. The official said he did not direct them to share information with NVIDIA or to intervene in their decisions.
The episode still set off internal discussions at Commerce, where officials worried that the department's contacts with NVIDIA could compromise the case, according to Investing.com. The Justice Department then asked Commerce to suspend its work and hand the case over, people familiar with the matter said. Seeking Alpha, also citing the Times, said the move was made to avoid a potential compromise of the investigation.
The Justice Department is now running a criminal inquiry into Megaspeed, the reports say. Investing.com called the transfer unusual, because Commerce investigators had spent months building the case and could have sought administrative action to restrict the company's access to US technology. It also noted that the report contains no evidence that Kessler ordered a halt or that NVIDIA changed the outcome.
NVIDIA has defended its contacts with officials, saying it regularly passes on information gathered from the field, asks for guidance and works with authorities to stop suspected smuggling while keeping lawful sales going. Commerce did not immediately respond to Seeking Alpha's request for comment. No charge has been announced.
Megaspeed imported billions of dollars' worth of NVIDIA AI equipment into Malaysia while it built data centers across Southeast Asia for Chinese clients, including Alibaba, according to the Times as summarized by Investing.com. Running data centers for Chinese customers is not illegal in itself; US authorities suspected that some of the chips were rerouted into China.
US officials have investigated Megaspeed and its executive Huang Le, also known as Alice Huang and no relation to Jensen Huang, since 2024, Seeking Alpha said. US intelligence officials reportedly believe she worked for the Chinese government, an allegation China's foreign ministry called groundless. No US agency has confirmed that assessment on the record.
For buyers and operators of accelerators, the wider point is the pace of export enforcement. The Times also reported that Commerce has not added a company to its Entity List, the US trade blacklist, in more than a year, the longest such stretch in 18 years.
NVIDIA shares fell about 4.5% in late-morning trading on Nov. 9, according to Seeking Alpha.
The accounts rest on people familiar with the matter and one Commerce official, and we could not read the original Times article, which is behind a paywall. No agency has confirmed the Justice Department inquiry on the record. The next dates to watch are NVIDIA's third-quarter results on Nov. 17 and the closed-door briefing House Republican committee chairs requested for Nov. 18, as we reported. The board inquiry has no announced timetable.
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