The US Defense Department has sought to retract a report alleging that the broker solicited millions of dollars in investments for Hegseth.
Published on 31 March 2026
The United States Defense Department has sought to retract a newspaper report alleging that a broker for defense chief Pete Hegseth attempted to make large investments in arms companies ahead of a war on Iran.
Pentagon spokesman Sean Parnell demanded an “immediate” withdrawal on Monday after The Financial Times reported that a money manager for the defense secretary had contacted BlackRock about investing several million dollars in defense-related funds in the weeks before the war.
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Hegseth’s broker at Morgan Stanley ultimately did not proceed with the investment in the exchange-traded fund, whose holdings include Lockheed Martin and Northrop Grumman, because it was not available for purchase at the time, The Financial Times reported, citing three unnamed sources.
“This allegation is completely false and fabricated. Neither Secretary Hegseth nor any of his representatives contacted BlackRock about any such investment,” Parnell said in a post on social media.
“This is another baseless, dishonest smear designed to mislead the public.”
Hegseth and his department “remain steadfast in their commitment to the highest standards of ethics and strict adherence to all applicable laws and regulations,” Parnell said.
Al Jazeera could not independently confirm the Financial Times report.
The Defense Department did not immediately respond to a request for comment sent outside normal business hours.
The Financial Times and Morgan Stanley also did not immediately respond to inquiries.
BlackRock declined to comment.
The report comes amid scrutiny of precisely timed trades in financial and prediction markets, fueling speculation that people with insider information could profit from US President Donald Trump’s war plans.
While The Financial Times reported that the investment attempt by Hesgeth’s broker did not go ahead, the defense chief would not have made money on such purchases in the month since the war began.
While the iShares Defense Industrials Active ETF has risen more than 25 percent in the past year, it has fallen about 13 percent since the US and Israel launched attacks on Iran on February 28.
