The Financial Times has just revealed that an intermediary acting on behalf of the US Secretary of Defense, Pete Hegseth, attempted to invest in the military industrial sector. This move took place shortly before the American-Israeli offensive against Tehran, raising suspicions of insider trading.
Pentagon spokesperson Sean Parnell has described these allegations as “completely false and fabricated“. He demands an immediate retraction from the British newspaper. The Secretary of Defense denies any contact with BlackRock through intermediaries.
The attempt involved BlackRock’s Defense Industrials Active ETF. This fund, launched in May 2025, includes the main military industrial stocks. The investment did not go through due to technical compliance issues at Morgan Stanley.
This case is part of increased monitoring of financial transactions preceding decisions by Donald Trump. Several well-synchronized capital movements have been observed before major political announcements. Experts are questioning possible leaks of privileged information at the top of the state.
BlackRock has declined to comment on this information. Morgan Stanley has also not responded to Reuters’ inquiries. Uncertainty remains about the level of information the broker had to act on behalf of Pete Hegseth.
The American regulatory framework imposes strict restrictions on cabinet members’ investments. Direct investment in a sector related to ministerial responsibilities poses a major ethical risk.
The Financial Times article does not specify whether the Secretary of Defense was aware of his broker’s actions. Rumors of information leaks are now affecting the credibility of military decisions. The White House has not yet issued an official statement on this financial aspect.
Prediction markets showed signs of unusual activity before the attack. These platforms allow betting on the outcome of geopolitical events. The Hegseth affair could expedite the implementation of new compliance rules for senior officials.
The Trump administration is facing a barrage of criticism on conflict of interest management. The ties between the business community and national security officials are being scrutinized by Congress. This new controversy could weaken the Secretary of Defense’s position in upcoming budget hearings.
Sean Parnell’s denial on X underscores the tension between the Pentagon and the financial press. The spokesperson emphasizes the complete lack of basis for the FT’s investigation. Reviewing communication logs between Morgan Stanley and BlackRock will be crucial for the investigation’s progress.
The outcome of this controversy will depend on the transparency of the Secretary’s account statements. For now, no concrete evidence of a valid purchase order has been produced. However, the defense sector remains under close stock market monitoring due to instability in the Middle East.
