Nvidia’s value tumbles by $330bn after ‘honeytrap’ investigation launched, as China denies spying claims – business live | Business

Investigators at the US commerce department had been looking into a Singaporean company suspected of smuggling Nvidia’s AI chips into China last year, the New York Times reports.

The probe came to an abrupt end when it was transferred instead to the justice department, following an email from Nvidia’s general counsel seeking information.

The investigation was centred on data centre company Megaspeed, led by an executive now believed to be a Chinese spy who had a relationship with Nvidia’s CEO Jensen Huang.

The NYT reports:

It is not necessarily unusual for Commerce Department agents working on a case to speak with a company’s representatives about issues involving their firm. But what was unusual was the content of the message. Tim Teter, Nvidia’s general counsel, said that Jeff Kessler, a top official at the department, had given Nvidia permission to reach out about the case.

The agents were alarmed that Nvidia had invoked the name of Mr. Kessler, their superior, who was nominated to his role by President Trump. Some viewed Mr. Kessler’s interaction with Nvidia as violating government procedure and potentially tainting the case, according to current and former government officials and others familiar with the incident.

Nvidia’’s board said in a statement on Sunday that, while it has no reason to believe that either US national security or Nvidia secrets were compromised, its inquiry will examine all available information.

“The Board prioritizes US national and economic security, which is paramount to the interests of NVIDIA and its shareholders,” the company said. “The Board has confidence in Jensen and his leadership team and will provide further updates as appropriate.”