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Pentagon Demands Retraction of Report Linking Official to Weapons Investment

US DoD denies report of Hegseth's broker seeking weapons investment.

Mar 31
3 min read
Pentagon Demands Retraction of Report Linking Official to Weapons Investment

Top Summary

  • What happened: The US Department of Defense is demanding a retraction of a Financial Times report alleging Pete Hegseth's broker sought a large investment in defense companies.
  • Why it matters: The report raised concerns about potential insider trading and profiting from the US-Iran conflict.
  • What changes for people: The DoD's strong denial aims to dispel public mistrust and maintain confidence in ethical conduct.
  • Who is affected: Pete Hegseth, the US Department of Defense, BlackRock, Morgan Stanley, and the public are all affected.

DoD Denounces Report as 'False and Fabricated'

The United States Department of Defense (DoD) has called for an immediate retraction of a recent news report. The report alleged that a broker representing defense official Pete Hegseth attempted to make a substantial investment in weapons manufacturing companies.

This alleged attempt occurred in the weeks leading up to the conflict with Iran. The DoD strongly refutes the claims.

Report Sparks Controversy

The Financial Times reported that Hegseth's wealth manager contacted BlackRock. The contact was regarding a multi-million dollar investment in a defense-related fund. This occurred shortly before the war began.

The fund included holdings in major companies like Lockheed Martin and Northrop Grumman. Citing three unnamed sources, the FT stated the investment did not proceed because the fund was unavailable at the time.

Pentagon's Strong Denial

Pentagon spokesman Sean Parnell issued a statement. He described the allegation as

"entirely false and fabricated."

He stated that neither Hegseth nor his representatives contacted BlackRock regarding any such investment.

 

Parnell added,

"This is yet another baseless, dishonest smear designed to mislead the public."

 

Ethical Conduct Emphasized

Parnell affirmed that Hegseth and his department remain committed to ethical standards. He stated,

"[They remain] unwavering in their commitment to the highest standards of ethics and strict adherence to all applicable laws and regulations."

Market Speculation

The report surfaced amidst increased scrutiny of financial market activities. There has been some speculation of insider knowledge being used to profit from President Trump's war plans.

While the attempted investment by Hegseth’s broker did not proceed, the defense chief would not have profited in the past month since the US-Iran conflict commenced.

The iShares Defense Industrials Active ETF has fallen nearly 13 percent since the strikes on Iran began on February 28, despite a 25 percent rise over the past year.

Responses Pending

The Defense Department did not immediately respond to a request for comment sent outside of usual business hours. The Financial Times and Morgan Stanley also did not immediately respond to inquiries. BlackRock declined to comment.

What to Watch Next

The public awaits responses from The Financial Times and Morgan Stanley regarding the DoD's demand for retraction. Further developments will likely hinge on whether the Financial Times provides additional evidence to support its reporting or issues a retraction.