The US will sanction overseas artificial intelligence models if they are found to use stolen intellectual property, Treasury Secretary Scott Bessent said in a recent television interview. The administration is identifying US watermarks within Chinese models and treating model distillation as IP theft that could trigger punitive measures.

The warning shifts from prior discussions about direct bans on Chinese open-source AI models like Kimi K3, which the White House briefly considered following competitive and cybersecurity concerns. Rather than an outright prohibition, Bessent stated the administration will evaluate Chinese models in the coming days and weeks to determine if technology was used without permission. Officials plan to impose sanctions on models confirmed to use stolen materials.