Treasury Secretary Scott Bessent on Wednesday warned that Chinese artificial intelligence companies could face sanctions and Entity List designations if they use "industrial-scale distillation attacks" that cross into intellectual property theft.
Bessent Escalates Warning In a post on X, Bessent said President Donald Trump's administration supports open-source AI and the innovation it unlocks but added that "open source is not open season on American IP." "When PRC firms conduct covert, industrial-scale distillation attacks that cross the line into IP theft, sanctions and Entity List designations will be on the table," Bessent added.
We support open-source AI and the innovation it unlocks.
But open source is not open season on American IP.
When PRC firms conduct covert, industrial-scale distillation attacks that cross the line into IP theft, sanctions and Entity List designations will be on the table.— Treasury Secretary Scott Bessent (@SecScottBessent) July 22, 2026 Meanwhile, Rep.
