DHS bans DeepSeek from all federal government systems

The Department of Homeland Security issued a memo in July, made public on Monday, ordering all federal civilian agencies to remove AI models developed by DeepSeek. The order bans future purchases of DeepSeek products and services, extending the prohibition to third-party services that use the models, including fine-tuned versions and startup services powered by them. DHS warned that using DeepSeek models may result in the transfer of sensitive data to the People's Republic of China if used by U.S. government employees or vendors. The department stated that such use could produce actionable intelligence on U.S. persons or government agencies and claimed the models may contain malware or security vulnerabilities. The ban applies even if the models are hosted by a hyperscaler on U.S. soil, although no technical reports suggest malware in those specific versions. The order also applies if DeepSeek was used only in the development process. While not as extensive as the 2019 Huawei ban, the directive could chill startups building on Chinese models, particularly those seeking government contracts or military supply chain work.