U.S. Senate Committee on Banking, Housing and Urban Affairs ranking member and lawmakers seek Defense Department information on private equity risks in defense contracting

The U.S. Senate Committee on Banking, Housing and Urban Affairs published a letter from Ranking Member Elizabeth Warren, joined by Senator Richard Blumenthal and Representative Ro Khanna, to Defense Secretary Pete Hegseth warning that the Department of Defense’s growing reliance on private equity-backed defense contractors could pose risks to taxpayers and national security. The lawmakers asked for information on the Department’s engagement with private equity firms and on its efforts to comprehensively analyze private equity deals involving defense contractors. The letter says private equity investment in the defense industry has grown significantly over the past two decades and reached record highs in recent years. It argues that private equity-backed contractors are more likely to go bankrupt because of debt-heavy acquisition strategies and that the sector’s opaque ownership and funding structures raise foreign influence and supply chain concerns, including where funds may have investors or capital sources from countries adversarial to or misaligned with the United States while gaining access to sensitive or classified information. The lawmakers requested a response by June 10, 2026.