A group of Democratic lawmakers is pressing the White House for answers regarding a $620 million loan from the Department of Defense to a North Carolina startup financially backed by a venture capital firm linked to Donald Trump Jr. The lawmakers, in a letter to White House Chief of Staff Susie Wiles, expressed concern over what they describe as “an egregious example of Trump administration corruption,” based on recent reporting by ProPublica.
Details of the Loan and Investment
The startup, Vulcan Elements, a rare-earth magnet company, received not only the Pentagon loan but also a $50 million investment from the Department of Commerce. The company is backed by 1789 Capital, a venture firm that Donald Trump Jr. joined as a partner in 2024. The lawmakers are specifically inquiring whether Peter Navarro, an adviser to President Donald Trump, helped secure the loan.
Lawmakers' Concerns
“If this report is accurate, it reveals a staggering level of corruption and influence peddling that superseded this process, enriching the President’s son at the expense of U.S. national security and taxpayer dollars,” the Democrats wrote. They emphasized that the Department of Defense contracting process should be “fair, unbiased, and competitive” to ensure taxpayer money is spent appropriately.
The letter was signed by Senators Elizabeth Warren, Richard Blumenthal, and Mazie Hirono, along with Representatives Jason Crow and Mike Levin. They have requested a response by June 16.
ProPublica's Reporting
Last month, ProPublica reported that Navarro intervened in favor of Vulcan Elements while the Pentagon was considering funding for roughly a dozen companies. An unnamed Pentagon official stated that Navarro was the only top Trump aide to do so. Both the Pentagon and Trump Jr. denied any role in the deal, and Vulcan Elements’ founders said the company received no political favoritism. Navarro dismissed the story as “fake news on steroids.”
Timing of the Loan
The loan was approved approximately three months after 1789 Capital took a financial stake in Vulcan Elements. Sources told ProPublica that once the White House requested the loan, Pentagon officials were asked to “move at an unusually rapid pace” to finalize it, with staff working late nights over several weeks.
Additional Questions
The lawmakers are also seeking information about other potential government investments involving companies backed by 1789 Capital, including a $10.8 million Pentagon contract and a $100 million Commerce investment to PsiQuantum, a quantum chip startup.
The Independent has contacted the White House and Department of Defense for comment.
