The US Department of Defence has called for the immediate retraction of a media report alleging that a broker linked to Defence Secretary Pete Hegseth sought to invest in defence companies ahead of the war with Iran.

Pentagon spokesman Sean Parnell on Monday dismissed the report by the Financial Times as “entirely false and fabricated,” denying that Hegseth or his representatives had approached asset manager BlackRock regarding any such investment.

The report claimed that a wealth manager working with Hegseth contacted BlackRock in the weeks leading up to the conflict to explore a multimillion-dollar investment in a defence-focused exchange-traded fund.

According to the newspaper, the proposed investment did not proceed because the fund was not yet available for purchase at the time.

“This is yet another baseless, dishonest smear designed to mislead the public,” Parnell said, adding that the defence secretary and his department remain committed to high ethical standards and compliance with all applicable laws.

A spokesperson for the Financial Times said the outlet stands by its reporting and noted that the Pentagon’s response had been included in the article.

The Pentagon did not immediately respond to further requests for comment, while BlackRock declined to comment, and Morgan Stanley, where the broker is said to be based, did not immediately reply to inquiries.

The report comes amid heightened scrutiny over trading activity in financial and prediction markets, with some observers raising concerns about whether individuals with insider knowledge could benefit from developments linked to US President Donald Trump’s war policies.