The U.S. Department of Homeland Security has ordered civilian government agencies to purge AI technology developed by Chinese startup DeepSeek from IT systems and barred future federal procurement. DHS cited national security threats, warning that DeepSeek models could expose sensitive federal data to the Chinese government or contain malware. The directive expands a broader U.S. technological crackdown that includes prior device bans by the Commerce Department and Navy.
DHS directives banning and monitoring DeepSeek
- ▪A July 24, 2026 DHS memo made public on October 19, 2026 directed federal agencies to monitor web traffic flowing in and out of government websites for DeepSeek-related security risks.
- ▪The Department of Homeland Security ordered federal civilian agencies on October 19, 2026 to remove DeepSeek products and third-party services using its AI models from government IT systems and bar new purchases or acquisitions.
- ▪The order signed by Homeland Security Secretary Markwayne Mullin excludes DeepSeek from participating in federal government contracts and took effect from the end of July 2026.
DHS warnings regarding DeepSeek security threats
- ▪The Department of Homeland Security warned that DeepSeek models pose multiple threat vectors, could produce actionable intelligence on U.S. persons and agencies, and may contain malware or security vulnerabilities.
- ▪The Department of Homeland Security stated that using DeepSeek may result in the transfer of sensitive data belonging to U.S. government employees or vendors to the Chinese government.
Prior federal and State restrictions on DeepSeek
- ▪Prior to the October 19, 2026 federal directive, the U.S. Department of Commerce and the U.S. Navy had already banned DeepSeek on government-issued devices.
- ▪U.S. states including New York, Tennessee, and Virginia previously enacted state-level restrictions on the use of DeepSeek on official devices.
Allegations of Chinese exploitation and copying of U.S. AI
- ▪U.S. AI firms Anthropic and OpenAI claimed that Chinese AI firms, including Hangzhou-based startup DeepSeek, essentially copied their AI models.
- ▪White House tech lead Michael Kratsios wrote in an internal memo in 2026 that malicious exploitation of American AI firms had been occurring primarily by competitor firms in China.
DeepSeek cost efficiency and market impact
- ▪DeepSeek trained its initial model for approximately $6 million, compared to roughly $100 million spent by OpenAI to develop GPT-4.
- ▪DeepSeek's open-source AI release on January 27, 2025 caused Nvidia's stock to fall 16%, wiping out approximately $600 billion of Nvidia's market value.
FCC restrictions on Chinese technology and testing
- ▪The Federal Communications Commission scheduled an October 29, 2026 vote on barring all Chinese laboratories from testing electronic devices for the U.S. market, where 82% were tested in 2025.
- ▪In July 2026, the Federal Communications Commission voted to prohibit U.S. sales of devices containing key hardware from Chinese firms deemed national security risks.
- ▪In December 2025, the Federal Communications Commission banned imports of all new Chinese drone models and consumer internet routers.
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