Defense Secretary Pete Hegseth attends a meeting at the Pentagon in Washington, March 31, 2026.Jonathan Ernst/Reuters
A contingent of Democratic senators are seeking additional details regarding the finances and investments of Defense Secretary Pete Hegseth following a story — for which the Pentagon has demanded a withdrawal — alleging he may have considered investing in military industry stocks prior to the start of the conflict in Iran around five weeks prior.
"If this account holds true, it would seem to signify a shocking attempt to capitalize on your insider awareness of the President's war strategies," Democratic Sens. Elizabeth Warren, Richard Blumenthal, Tammy Duckworth, Jeff Merkley and Gary Peters penned in correspondence to Hegseth — provided exclusively to ABC News — on Wednesday evening. "This would constitute a severe conflict of interest and a possible breach of your federal ethics agreement — along with a disservice to the country bearing the burdens of this conflict and the armed forces you are deploying into harm's way."
The Financial Times disclosed earlier this week that a broker acting for Hegseth at Morgan Stanley got in touch with BlackRock — an investment firm — and sought to make a substantial investment into a fund encompassing defense company stocks several weeks before the Iran war.
The investment was not carried out because it had not yet become accessible for Morgan Stanley clients, according to the Financial Times — also noting that it remains uncertain whether Hegseth's broker discovered a different military industry fund for investment.
Defense Secretary Pete Hegseth attends a meeting at the Pentagon in Washington, March 31, 2026.Jonathan Ernst/Reuters
ABC News has not on its own verified the Financial Times' reporting.
When contacted by ABC News, both Morgan Stanley and BlackRock chose not to offer commentary on the Financial Times story.
In a message on X on Monday, chief Pentagon spokesman Sean Parnell rejected the report, deeming it "totally untrue and concocted" and requested a formal correction from the Financial Times.
Nevertheless, the Democratic senators, spearheaded by Armed Services Committee member Warren, stated in their letter that should the report prove to be correct, it would be a "grave betrayal of public confidence" and an infringement of the ethics agreement he endorsed before his confirmation as defense secretary.
"The American citizenry warrants leaders they can rely on to prioritize national security interests above their personal monetary gain," the senators conveyed to Hegseth.
Under the Department of Defense's code of conduct, Hegseth is barred from possessing stock in a list of 10 prominent industry-specific organizations including Lockheed Martin, Northrop Grumman, General Dynamics, Huntington Ingalls Industries, Boeing, RTX Corporation and L3Harris, which constitute a portion of the fund the Financial Times article claims Hegseth's broker sought to invest in.
As per his most recent financial disclosure reviewed by ABC News, Hegseth possesses no significant holdings in defense firms.
"Given this was a sizable investment in a sector-concentrated fund, your agreement seemingly suggests that your broker would have necessitated your consent or that you had no intent to abide by the commitments you established in your ethics agreement," the senators wrote.
The senators have called upon Hegseth to address a series of inquiries concerning the Financial Times report.
They are asking Hegseth to indicate whether he imparted any details to his broker regarding forthcoming military actions or whether he instructed his broker to put funds into any defense-related investments, including BlackRock as indicated by the Financial Times, prior to the Iran war. They are also seeking clarification on the directives Hegseth has provided to his broker to prevent conflict of interests, as well as a record of any defense stocks possessed and disposed of by Hegseth and his spouse.
Defense Secretary Pete Hegseth speaks during a press conference at the Pentagon, March 31, 2026 in Arlington, Virginia.Win McNamee/Getty Images
In his declaration, Parnell affirmed that Hegseth and the Department of Defense "remain steadfast in their dedication to the strictest ethical guidelines and uncompromising compliance with all relevant statutes and regulations."
The senators contend that receiving answers to their questions will assist them in "identifying potential shortcomings in the department's current procedures and policies aimed at preventing conflicts of interest."
House Democrats are also delving into the allegations surrounding Hegseth put forth in the Financial Times account.
Rep. Robert Garcia, the leading Democrat on the House Oversight Committee, announced on Tuesday that he would initiate an inquiry into the situation.
Republicans have not been publicly commenting on the Financial Times report. ABC News has attempted to reach Senate Armed Services Committee Chairman Roger Wicker for input regarding Democrats' demands for an investigation, though no response was given.
ABC News' Elizabeth Schulze and Lauren Peller assisted in the production of this report.
Editor’s note: This article has been revised to reflect that Sen. Jeff Merkley is among those who have signed the letter.
Sourse: abcnews.go.com