US Secretary for Defence Pete Hegseth is finding himself in a different kind of war – one of words with London’s Financial Times (FT).
According to a story published in the FT, a broker for Hegseth sought to make a large investment in major defence companies in the weeks before the US-Israeli attack on Iran.
Citing three sources familiar with the matter, the FT reported Hegseth’s broker at Morgan Stanley contacted BlackRock in February about a multimillion-dollar investment in the asset manager’s Defence Industrials Active ETF, shortly before the US launched military action against Tehran.
The inquiry on behalf of the high-profile potential client was flagged internally at BlackRock, according to the sources.
BlackRock’s $3.2 billion equity fund, ticker IDEF, aims to grow by investing in companies that may benefit from increased government spending on defence and security amid geopolitical tensions. Its largest holdings include defence conglomerates RTX, Lockheed Martin and Northrop Grumman, all major contractors for the US Department of Defence, as well as data integration firm Palantir.
Following the publication of the FT report, the United States Department of Defence has demanded the retraction of the report.
Pentagon spokesman Sean Parnell demanded the “immediate” retraction on Monday after the FT reported a wealth manager for the defence secretary contacted BlackRock about making a multimillion-dollar investment in a defence-related fund in the weeks leading up to the war.
Hegseth’s broker at Morgan Stanley ultimately did not go ahead with the investment in the exchange-traded fund, whose holdings include Lockheed Martin and Northrop Grumman, because it was not yet available for purchase at the time, the FT reported, citing three unnamed sources.
“This allegation is entirely false and fabricated. Neither Secretary Hegseth nor any of his representatives approached BlackRock about any such investment,” Parnell said in a post on social media.
“This is yet another baseless, dishonest smear designed to mislead the public.”
Hegseth and his department “remain unwavering in their commitment to the highest standards of ethics and strict adherence to all applicable laws and regulations,” Parnell said.
