The Pentagon has denied reports that a broker linked to U.S. Defense Secretary Pete Hegseth attempted to make major investments in defense companies ahead of the Iran conflict.
According to a report, Hegseth’s broker at Morgan Stanley contacted BlackRock in February regarding a potential multimillion-dollar investment in its iShares Defense Industrials Active ETF. The fund includes major defense companies such as RTX Corp, Lockheed Martin, and Northrop Grumman.
However, the proposed investment did not move forward, reportedly because the fund was not yet available for Morgan Stanley clients at the time. It remains unclear whether any alternative investments were pursued.
Pentagon Chief Spokesman Sean Parnell rejected the claims, calling the report “entirely false and fabricated.” In a statement, he said neither Hegseth nor his representatives approached BlackRock regarding any such investment.
The development comes amid the ongoing U.S. conflict with Iran, which has entered its fifth week, raising geopolitical tensions and market sensitivities around defense-related industries.
Meanwhile, U.S. military presence in the region has increased, with reports indicating preparations for extended operations. President Donald Trump has also warned of further escalation if key shipping routes, including the Strait of Hormuz, are not reopened.
