'Here to raid the cupboards?' Watchdogs snap to attention over new Hegseth hires

Defense Secretary Pete Hegseth's latest appointments to the Pentagon's Defense Policy Board are drawing scrutiny from government ethics watchdogs, who warned they have direct financial stakes in the defense industry.

Among the new board members are venture capitalist Marc Andreessen and former Republican Senate candidate Blake Masters, both of whom have ties to companies that overlap with Donald Trump Jr.'s investment fund, 1789 Capital, which has major investments in military and space technology, reported The Guardian.

The firm Andreessen Horowitz co-invests alongside 1789 Capital in at least three major defense contractors, including autonomous weapons maker Anduril Industries and SpaceX, and Masters sits on three boards connected to 1789 Capital through blank-check companies tied to the fund's co-founder.

Both men now sit on a board that advises the defense secretary on strategy and the defense-technology sector — the same sector where their financial interests, and those of the president's son, are deeply embedded.

"A lot of the people appointed to them are seeking government business — specifically seeking business with the agency they're serving," said Scott Amey, general counsel at the Project on Government Oversight, which tracks conflicts of interest on federal advisory panels. "So you worry, are some of these people here to raid the cupboards and learn as much as they can to give a competitive advantage to their employer or clients? Or are they trying to push contracts in a way that would benefit an employer or client?"

Companies jointly backed by a16z and 1789 Capital have already collected billions in federal contracts and loans since the start of Trump's second term. Anduril's federal funding jumped from roughly $760 million to about $1.25 billion in comparable stretches before and after the transition, while SpaceX has landed contracts worth billions more, including for missile-tracking satellites tied to Trump's "Golden Dome" initiative.

"About half of this board comes from the defense industry and they're actively working in the defense industry," said Nick Cleveland-Stout of the Quincy Institute for Responsible Statecraft, who compared the current board to the one under George W. Bush, when a third of members had active ties to defense contractors.

In the run-up to the 2003 Iraq invasion, an investigation found at least nine of its 30 members held ties to contractors with billions in Pentagon business, and its chairman resigned amid conflict-of-interest allegations.

“A lot of the people appointed to [advisory committees] are seeking government business – specifically seeking business with the agency they’re serving,” Amey said.

The Department of Defense did not respond to requests for comment on the new appointments, and Andreessen Horowitz also did not respond.