White House adviser intervened to fast-track $620m Pentagon loan for firm linked to Trump Jr
Records show the loan was processed in weeks rather than months, while Donald Trump Jr’s venture capital firm held an undisclosed stake in the rare-earth startup.
A senior adviser to President Donald Trump initiated a request for the Pentagon to provide a $620 million loan to Vulcan Elements, a rare-earth magnet startup in which Donald Trump Jr.’s venture capital firm holds an undisclosed stake, according to records reviewed by ProPublica. The intervention by Peter Navarro, the president’s senior counselor for trade and manufacturing, resulted in the deal being processed with unusual speed, bypassing the standard months-long bureaucratic vetting typically required for such funding.
The loan was part of a broader Pentagon initiative managed by the Office of Strategic Capital, established to reduce United States dependence on Chinese critical mineral supply chains. However, interviews and Defense Department records indicate that Vulcan Elements was the only deal among dozens considered by the Pentagon that was initiated by a top aide to the president. Pentagon staff worked late nights and with little sleep to expedite the loan after receiving the White House request, completing the transaction in a matter of weeks.
Donald Trump Jr.’s venture capital firm, 1789 Capital, took an undisclosed stake in Vulcan Elements approximately three months before the Pentagon announced the loan. Estimates of the company’s valuation increased tenfold following the announcement, rising from approximately $200 million to around $2 billion. The Trump administration has expanded the Office of Strategic Capital’s lending authority from about $1 billion to $200 billion and shifted from an open application process to one driven by personal networks and rapid deal-making.
Democratic lawmakers have raised concerns about cronyism and self-dealing, with some demanding an accounting of how the company was selected. A group of Democratic senators wrote to the Pentagon questioning whether the Trump family’s conflicts of interest were resulting in a waste of taxpayer dollars and a threat to national security. Members of the House attempted to subpoena Trump Jr. to testify on the deal, but the effort was blocked by Republicans.
The White House, the Pentagon, and Trump Jr. have denied any political favouritism or improper influence in the deal. A White House spokesperson stated the administration is working in the best interest of the American people, while a Pentagon spokesperson insisted that outside affiliations play no role in funding decisions. Trump Jr.’s spokesperson said the president’s son has no knowledge of how the deal came together and did not discuss the company with federal officials.
Navarro and Trump Jr. have formed a close bond in recent years, with Trump Jr. visiting Navarro in prison while Navarro served time for defying a subpoena related to the January 6, 2021, Capitol riot. A week before the Vulcan deal was announced, Trump Jr. hosted Navarro on his streaming show, “Triggered,” and encouraged subscribers to buy Navarro’s book. Navarro did not respond to questions from ProPublica, nor did Vulcan Elements.
