US Treasury Secretary Bessent warns of sanctions against China over alleged AI model theft through distillation; claims watermarks of US models found in Chinese AI systems amid rising competition from startups like Moonshot AI

Bessent says U.S. could sanction China over AI model 'theft'

Scott Bessent, US treasury secretary, during the 2026 Reagan National Economic Forum at the Ronald Reagan Presidential Library in Simi Valley, California, US, on Friday, May 29, 2026. Caroline Brehman | Bloomberg | Getty ImagesU.S. Treasury Secretary Scott Bessent on Tuesday said the Trump administration will look into whether Chinese artificial intelligence models have been distilled from American models, stating that the government does not support "IP theft."Chinese open-weight models are gai...