Democrats launch Nvidia investigation, write scathing letter on Huang’s ‘scheme’ with Trump

Democrats on Thursday opened an inquiry into how the Trump administration handled Nvidia's chip sales to China, a move landing hours after Nvidia removed founder and CEO Jensen Huang from the company. Huang had confessed to an extramarital affair amid reports of a relationship with a woman accused of being a Chinese spy, and has since faced further allegations of affairs involving Nvidia employees. He has also agreed to testify before a separate, Republican-led group of House committees.

The inquiry is led by Rep. Richard Neal of Massachusetts, the top Democrat on the House Ways and Means Committee, and Sen. Ron Wyden of Oregon, the top Democrat on the Senate Finance Committee. Their letter goes to Commerce Secretary Howard Lutnick and asks the department to preserve records. As the minority party, the Democrats can pose questions but cannot compel answers, which limits the inquiry's enforcement power.

The letter lays out what it describes as a "scheme": President Trump permitted sales of Nvidia's H200 chips to China on condition that the chips, manufactured in Taiwan, first ship to the United States. Upon arrival, a tariff was added — what the letter calls "effectively taking a cut of Nvidia's sales to China through what appears to be an unconstitutional export tax system." Only then did Commerce, under Lutnick, issue an export license. A revenue-sharing element was already public: in August 2025, Nvidia and AMD each agreed to hand 15% of their China chip-sale revenue to the U.S. government in exchange for export licenses, the AP reported at the time.

Much of the letter's scrutiny falls on the Commerce Department rather than on Nvidia alone. It asks why Lutnick kept allowing Megaspeed — a Singapore-based company U.S. officials suspect helped route advanced Nvidia chips into China — to keep buying after intelligence officials reportedly flagged both their suspicions about Alice Huang, a Megaspeed executive, and Jensen Huang's relationship with her. It also questions approvals granted to other Asian companies operating "with no physical presence at their listed addresses."

Timing and money feature centrally. The letter notes the export deal cleared after Trump learned of what it terms "Mr. Huang's compromised position," and after Nvidia donated $26 million toward Trump's projects, including a ballroom — raising the question of whether knowledge of the affair was leveraged for donations. It follows Trump's Sunday "60 Minutes" remark that he and his team had threatened an unnamed AI executive with jail, after which the executive "totally changed."

This is the second congressional investigation opened since the alleged spy affair became public. The Republican-led group — leaders of the House Select Committee on the Chinese Communist Party, the House Foreign Affairs Committee and the House Intelligence Committee — demanded closed-door testimony and had threatened a subpoena; Huang agreed on Thursday, after his resignation. What remains open: whether Commerce and Lutnick produce records voluntarily, what Huang says under oath about the export arrangement, and whether Democrats can convert their questions into documents given their inability to compel.