U.S. Commerce Dept. Inquiry Into Megaspeed Was Halted After Nvidia Name-Dropped Trump Appointee

In a surprising turn of events, the U.S. Commerce Department's investigation into Megaspeed, a Singaporean data center company, was abruptly halted earlier this year. The probe, which had been ongoing for several months, aimed to uncover whether Megaspeed was involved in smuggling Nvidia's artificial intelligence chips into China. The focal point of the investigation was an executive at Megaspeed, believed by U.S. officials to be a Chinese spy who had previously collaborated with Nvidia's CEO, Jensen Huang.

However, the investigation was unexpectedly transferred to the Justice Department last year. This shift occurred after the Commerce Department's investigators received an email from Nvidia's general counsel, Tim Teter, seeking more information about the Megaspeed probe. The unusual request seemed to stem from Nvidia's general counsel, Jeff Kessler, having granted the company's permission to contact the Commerce Department agents involved in the case.

The email from Nvidia's general counsel raised concerns among the Commerce Department agents, who viewed Nvidia's interaction with their superior, Jeff Kessler, as a potential violation of government procedures. Kessler, who had been nominated to his role by President Trump, had given Nvidia the green light to reach out about the investigation.

Some government officials and insiders familiar with the situation believed that this exchange could have tainted the investigation, leading to its transfer to the Justice Department.