Trump Team Mulling Lutnick’s Future as Nvidia Scandal Widens
Commerce Secretary Howard Lutnick faces bipartisan calls to testify over his department's handling of Nvidia and China chip risks. Officials say the scandal differs from past attempts to undermine him, though some doubt President Donald Trump will drop his longtime friend.
President Donald Trump faces fresh pressure over Commerce Secretary Howard Lutnick, with a Trump team mulling Lutnick’s future as the Nvidia scandal deepens, according to multiple current and former officials. The department and its leaders are drawing bipartisan criticism.
Lutnick has survived scrutiny before, including over his ties to the late sex offender Jeffrey Epstein. He now faces the most intense pressure of his nearly two years in the job, as Republican and Democratic lawmakers demand he testify about how Commerce handled Nvidia and the national security risk of China gaining access to U.S. chips.
Calls to testify
Sen. Tim Scott, a South Carolina Republican who chairs the Senate banking committee, asked Lutnick in a letter to appear voluntarily. Sen. John Kennedy, a Louisiana Republican, said Lutnick should be subpoenaed if he declines.
Sen. Jim Banks, a Republican on the banking committee, accused Lutnick of defying the president. "Unfortunately the more we learn, the more concerned I am about the Department of Commerce, Secretary Lutnick defying President Trump's orders on Blackwell chips, so we need to investigate that," Banks said. Blackwell is an advanced chip made by Nvidia.
Pressure inside the administration
Lutnick is also under fire from within the administration. Officials say his close relationship with Nvidia CEO Jensen Huang produced lax oversight of the chipmaker. Huang has resigned amid the scandal.
At the center is Megaspeed, a Singapore-based firm that the U.S. government has examined for helping divert Nvidia's advanced chips to China. Huang reportedly had an affair with a Megaspeed executive suspected of being a Chinese spy. Lutnick reportedly resisted pressure from administration officials to put the company on a U.S. trade blacklist.
Seven current and former officials, who spoke anonymously about private conversations, said the seriousness of the allegations sets this episode apart from earlier efforts to undermine Lutnick. One senior official called the situation "a complete and utter disaster" that "perfectly encapsulates the last one-and-a-half years of working with Commerce."
Why Trump may hold back
Even some who think Lutnick should lose his job doubt Trump will turn on him, given the president's own role in decisions on chip exports to China. "POTUS himself was just too directly involved for this to be an easy, 'Lutnick is the scapegoat,'" said an administration official familiar with the relationship.
Trump and Lutnick have known each other for at least three decades. They met at charity events around New York City and grew close after the September 11, 2001, attack, which killed 658 staff members of Lutnick's financial firm, Cantor Fitzgerald, including his brother. Trump often runs ideas past Lutnick, and the two have been known to get ice cream at Mar-a-Lago.
That friendship has protected Lutnick before. The scrutiny now reaches beyond one company, coming days after Republicans were wiped out in the midterms, in part over the nationwide data center buildout driven by the AI boom. Critics, including GOP lawmakers and China hawks in the administration, are targeting Lutnick's hands-off approach to tech, and his fate carries major implications for the administration's wider AI policy.
