Warren questions Pentagon BOND program over Wall Street hiring

Sen. Elizabeth Warren is questioning the Pentagon BOND program, a new effort to bring private-sector professionals into Defense Department acquisition work, over possible conflicts of interest. For retail investors, the probe touches a key market channel: how government money and access can shape defense, technology and private-capital opportunities.

In a letter shared with CNBC, Warren, D-Mass., said the Defense Department’s plan to recruit people from business and finance could create “significant conflict of interest and revolving door concerns.” The letter was addressed to Deputy Defense Secretary Stephen Feinberg and David Lorch, director of the Office of Strategic Capital.

The Pentagon did not immediately respond to CNBC’s request for comment.

What is the Pentagon BOND program?

The Defense Department created Business Operators for National Defense, known as BOND, in February to place private-sector talent inside its acquisition process. Acquisition is the government process for buying goods and services, which in this case can include major defense contracts and technology projects.

Warren said in the letter that she has long worried about conflicts, revolving-door abuse and national security risks in Defense Department purchasing. She said she is now concerned about the implications of the BOND initiative and what she described as a Wall Street investor team, and she urged the department to put guardrails and oversight in place.

CNBC reported that The New York Times and The Wall Street Journal have described additional efforts by the Office of Strategic Capital to recruit private-sector workers, including from Wall Street, with salaries above $400,000 and possible future access to capital. The Office of Strategic Capital works on financing tools tied to national security priorities.

Warren focused in part on New York Times reporting that a headhunting firm prepared recruiting slides for the Pentagon that referred to access to senior U.S. and foreign government officials and fundraising channels. CNBC reported that it was not clear whether the Defense Department approved those slides.

What information is Warren seeking?

Warren asked Feinberg and Lorch nearly three dozen questions about the Pentagon’s outreach to private-industry professionals. Feinberg previously served as co-CEO of Cerberus Capital Management before becoming the Pentagon’s No. 2 official, and Lorch was previously a managing director, according to CNBC.

The senator asked the Defense Department to identify every industry expert tied to BOND and list the companies connected to them. She also asked whether BOND participants will count as government employees, what ethics rules will apply, and whether participants or Wall Street recruits to the Office of Strategic Capital previously worked at Cerberus.

Warren also requested a line-by-line explanation of how the Pentagon plans to use $88 million requested for BOND. She asked for details on $189 million requested for the Economic Defense Unit, which Feinberg set up and which works with the Office of Strategic Capital, and on $20.2 billion requested for what the letter described as “its recruitment of Wall Street investors.”

The letter also asks what safeguards are in place for executives from Palantir, Meta and OpenAI, and who at the Pentagon has been or will be hired at annual compensation of $400,000 or more. Warren asked whether those recruits would face ethics requirements while at the department and after leaving it.

The questions come as the Trump administration has blended business and government through steps that include taking equity stakes in companies producing goods considered essential to the national interest, according to CNBC. Warren’s letter puts pressure on the Pentagon to explain how it will use private-sector expertise without giving favored firms or financiers special access to public money and decision-makers.

This story draws on original reporting from CNBC.