In a letter addressed to Secretary of Defense Pete Hegseth last Thursday, Senators Elizabeth Warren, Andy Kim, and Richard Blumenthal, all Democrats, raised urgent questions about the Pentagon's financial dealings with companies linked to Donald Trump Jr. They sought transparency regarding whether the Department of Defense's allocations of substantial loans and contracts to these entities were free from conflicts of interest.
The senators emphasized that if such conflicts influenced the DoD's decisions, it could imply that the Trump family is benefiting from funds earmarked by Congress for national security purposes, thereby raising ethical and security concerns.
The inquiry adds to a broader dialogue about potential conflicts associated with the Trump family, which encompasses issues ranging from the former president’s personal investments to his family's business interests entering fields like nuclear fusion.
Following his father’s declared victory in the 2024 presidential election, Donald Trump Jr. announced his role as a partner at 1789 Capital, a venture capital firm. This firm is notable for investing in conservative-affiliated companies, including the media company owned by Tucker Carlson. On its social media platform X, 1789 Capital describes itself as supporting “great American companies that are building a country based on Entrepreneurship, Innovation, & Growth.” Many of the investments by 1789 Capital began during the tenure of the Biden administration.
According to the senators' letter, companies backed by 1789 Capital have secured multiple contracts with the Trump administration since it took office. An advisor to Donald Trump Jr. responded, stating that 1789 Capital maintains passive minority ownership without involvement in operational management. He characterized the senators' assertions as misleading, suggesting they presume audiences might not grasp the distinctions in investment roles. CNN has not independently verified these claims.
Critically, the senators do not allege any legal violations by Trump Jr. or 1789 Capital but are seeking clarification on the circumstances surrounding the contracts and loans.
Portfolio companies of 1789 Capital reportedly received over $70 million in Department of Defense contracts between April and November 2025, based on data from research firm PitchBook cited in the letter.
- In April 2025, the artificial intelligence company Cerebras Systems was awarded $45 million.
- In August 2025, rocket engine manufacturer Firehawk Aerospace received $4.9 million from the Air Force.
- Rare-earth magnet producer Vulcan Elements secured $10 million in contracts.
Additionally, in November, Vulcan Elements announced a $620 million loan from the Department of Defense’s Office of Strategic Capital, accompanied by $50 million in federal incentives from the Department of Commerce. This loan is notable as it is more than double the company’s full valuation and represents the largest loan the Office of Strategic Capital has granted since its inception in 2022.
The loan arrangement involved the Department of Commerce receiving $50 million in equity stake, with the DoD acquiring warrants that provide options to purchase Vulcan Elements stock at predetermined prices.
The senators’ letter requested details about the loan's competitive awarding process, along with records of all communications between DoD officials and Donald Trump Jr. since the 2024 election.
Another company, Unusual Machines, a drone technology firm where Donald Trump Jr. purportedly holds an advisory board position and shares, was granted a $12.8 million contract by the DoD in September 2025.
Among other examples, a quantum computing company named PsiQuantum, backed by 1789 Capital, received a $10.8 million contract from the US Air Force in April 2025. PsiQuantum also garnered a sizable contract worth $22.5 million during the Biden administration in 2022.
Warren, Kim, and Blumenthal articulated multiple concerns in their communication with Secretary Hegseth, notably questioning whether the Department followed a transparent and competitive process when arranging these contracts and loans. They also sought to identify any potential favoritism or conflicts impacting the stewardship of taxpayer resources and threats to national security integrity.
Due to the minority status of Democrats in the Senate, the lawmakers do not hold the authority to compel official responses from the Secretary of Defense.
Richard Painter, who served as the chief ethics official under President George W. Bush and is currently a law professor at the University of Minnesota, described the issues highlighted by the Democratic senators as “a very legitimate concern.” He underscored the importance of investigating any favoritism connected to contributors or the Trump family to uphold accountability.
Painter remarked that concerns over Pentagon contract awards have been persistent for decades; however, he noted a new element with the direct involvement of a president’s family in firms engaging with the defense sector.