After Huang exit, scrutiny turns to Nvidia’s China chips

Days after Jensen Huang stepped down as Nvidia's ↘ 2.01% chief executive, the focus has moved from his private life to a harder question. Reporting now points to how much the company knew about its chips reaching China through a Singapore customer at the center of the scandal. Megaspeed, the Nvidia customer that employed the woman Huang had an affair with, was suspected by U.S. and Singaporean authorities of breaching export controls, The Washington Post reported on Sunday.washingtonpost.com

Huang resigned as president, CEO and director with immediate effect on Thursday, November 12, according to Nvidia. Chief Financial Officer Colette Kress became interim CEO, and Harvey C. Jones was named the board's first-ever chair.investor.nvidia.com

How the downfall began

Secretary of State and national security adviser Marco Rubio set events in motion with a memo drawn from a CIA report, according to Post reporting summarized by Israel Hayom. The memo warned President Donald Trump about Huang's ties to Alice Huang, a suspected Chinese spy. The New York Times reported on October 29 that U.S. officials believed she was passing information to Beijing, and China's foreign ministry has rejected the claim as "groundless," Reuters reported.israelhayom.com+1

On November 8, Huang admitted to staff that he had been "unfaithful to my wife," and the board opened an investigation, AP reported. Reports of a second affair, this one with an executive who reported directly to him, came out late on November 11, and he resigned the next morning. Reuters has since reported that in October, Huang told general counsel Tim Teter and other senior leaders that his dealings with Alice Huang and Megaspeed were standard business with a customer.apnews.com+1

The export-control loophole

Megaspeed has bought more than $4 billion worth of Nvidia chips, CNN reported. Companies like it can get around U.S. export controls by renting computing power to Chinese firms. The Information reported that Alice Huang helped move about 240,000 restricted chips into China, according to Reuters. Megaspeed has denied diverting chips, and Singapore police have been investigating the company since last year, Reuters said.edition.cnn.com+2

Nvidia has said its checks showed "everything was where it should be." However, trade records cited by other outlets show tens of thousands of chips that don't match those counts, The National News Desk reported. Neither Huang nor Nvidia has been accused of wrongdoing.fox4beaumont.com

Pressure from Washington

Three House committees have called Huang to a closed-door interview on December 1, CNN reported. China hawks in Congress are pushing to add chip-export curbs to the annual defense bill. Nvidia is set to report quarterly results on Tuesday, November 17.edition.cnn.com

"American companies should never jeopardize our nation's security by giving Chinese companies access to their most advanced chips," Rep. John Moolenaar said, Israel Hayom reported.israelhayom.com