Key points
- The Commerce Department alleges the National Center for the Advancement of Semiconductor Technology (Natcast) misused funds.
- Natcast, a non-profit, is accused of operating as a “slush fund” benefiting Biden loyalists.
- The National Institute of Standards and Technology (NIST) will now oversee the $7.4 billion.
- The Commerce Department claims Natcast’s creation was illegal, violating legal restrictions on government corporations.
The U.S. Commerce Department announced on Monday that it is seizing operational control of a $7.4 billion semiconductor research fund, previously managed by the National Center for the Advancement of Semiconductor Technology (Natcast). The department alleges that Natcast, a non-profit established under the Biden administration, acted as a “semiconductor slush fund,” misusing taxpayer money and violating established legal frameworks.
The National Institute of Standards and Technology (NIST) will now assume responsibility for overseeing the funds and the associated National Semiconductor Technology Center.
Commerce Secretary Howard Lutnick issued a strongly worded statement condemning Natcast’s actions. He accused the Biden administration of illegally creating Natcast to circumvent legal restrictions on government corporations and of stacking the organization with former Biden officials.
Lutnick asserted that the organization was designed to shield itself from proper oversight and accountability, hindering future administrations from exercising their oversight responsibilities. The statement further highlighted the improper use of taxpayer money, characterizing the situation as a blatant misuse of funds.
The decision to transfer control to NIST follows allegations of financial mismanagement and a lack of transparency surrounding Natcast’s operations. The exact amount of funds already disbursed remains unclear, as both Natcast and the Commerce Department have yet to provide a definitive figure.
The Commerce Department emphasized the need to reform the semiconductor technology center’s operations to align with the requirements of the $52.7 billion Chips and Science Act, a law designed to boost domestic semiconductor manufacturing and research.
This move comes after Natcast itself declared its close alignment with White House priorities, boasting its role in securing America’s technological leadership. Despite these claims, the Commerce Department’s actions suggest a different reality.
The department’s decisive intervention marks a significant shift in the management of this critical funding, raising questions about the future of other similar public-private partnerships. The controversy also underscores ongoing concerns regarding government transparency and accountability in the handling of large-scale funding initiatives.
