China's spy agency thrust into spotlight by Nvidia CEO affair
China's Ministry of State Security is under new scrutiny after U.S. intelligence linked it to the businesswoman at the center of the Nvidia CEO affair.
A spy agency in the spotlight
China's Ministry of State Security, the country's main civilian intelligence agency, has been pulled into the center of the storm around Nvidia chief executive Jensen Huang. The Financial Times and The New York Times reported this month, citing sources, that U.S. intelligence believes the ministry recruited businesswoman Alice Huang to gather information on Jensen Huang. The two are not related.
Jensen Huang acknowledged an affair over the weekend, but it remains unclear whether any sensitive information was shared. The reports have turned a corporate scandal into a national security question, and drawn scrutiny from lawmakers, the company's board and investors.
What the ministry is
The ministry is an opaque body with no official administrative website, apart from one supporting whistleblowers. China established it in 1983, in part to respond to risks from the country's new openness to foreigners after roughly three decades of tightly closed borders, according to research by Sheena Chestnut Greitens, an associate professor at the University of Texas at Austin.
The ministry has gained political influence under President Xi Jinping and prominence as Beijing has put more emphasis on national security since 2023. In 2023 it opened an account on the social media platform WeChat. Its minister, Chen Yixin, published a rare article in September about improving governance of artificial intelligence and preventing related security risks.
- Ministry founded1983
- WeChat account opened2023
- Chip shipments linked to affairAt least $7.5 billion
The wider pattern
The affair is the latest case in which Beijing has been accused of targeting the U.S. technology sector. Matt Pearl of the Center for Strategic and International Studies said Beijing has increasingly targeted the sector to narrow the gap in artificial intelligence capabilities.
CrowdStrike said in June that Chinese entities broadly accounted for more than half of state-sponsored intrusions targeting technology companies, especially their artificial intelligence assets, in the 12 months through March 31. An agent of the ministry allegedly posed as a Stanford student for years to gather sensitive information, the Stanford newspaper reported last year.
How the Nvidia case unfolded
The Financial Times reported on Wednesday that the ministry approached a person who knows Alice Huang earlier this year to ask about her business and connections. It was unclear whether she was suspected of any wrongdoing, and the inquiry followed news of a Singapore probe into a company linked to chip-smuggling allegations.
The timeline kept moving. On Nov 8, Huang told Nvidia employees he had been unfaithful to his wife, and the board opened an independent investigation. On Nov 10, The Information reported the affair facilitated the shipment of at least $7.5 billion worth of Nvidia chips to Chinese firms, and the board retained Joon Kim of Wachtell Lipton to lead its probe. Senator Kevin Cramer called for Huang's resignation the same day.
