A Pentagon loan for $620 million to Vulcan Elements—an early-stage North Carolina rare-earth magnet company tied to Donald Trump Jr.—was reportedly initiated through a White House request. Interviews and Defense Department records reviewed by ProPublica descri
On paper, the Pentagon’s push to reduce U.S. dependence on China’s critical mineral supply chains is about national security. In practice, for one rare-earth start-up—Vulcan Elements—the road to a $620 million loan appears to have started in the White House.
Last year, the Pentagon announced a $620 million loan to Vulcan, a small North Carolina company tied to Donald Trump Jr. Defense officials and the company tried to tamp down suspicions of cronyism. Trump Jr., through a spokesperson, said he wasn’t involved. The Pentagon said Trump Jr. played no role in the record-setting deal. Vulcan’s founder told reporters the company received no political favoritism.
But interviews and Defense Department records reviewed by ProPublica described a different origin point for the request to move hundreds of millions of dollars to the firm. The request. those records and interviews show. was made by Peter Navarro—a White House adviser to President Donald Trump and a friend of Trump Jr.
Navarro, who served as trade adviser during Trump’s first term, has also formed a close bond with Trump Jr. in recent years. Trump Jr. visited Navarro in prison during Navarro’s time for defying a subpoena from lawmakers investigating the Jan. 6, 2021, Capitol riot. Trump Jr. was among a small group Navarro dedicated his latest book to for having “my back when it was against the wall.” A week before the Vulcan deal was announced. Trump Jr. hosted Navarro on his streaming show—encouraging his nearly 2 million subscribers to buy Navarro’s book. Navarro is now the president’s senior counselor for trade and manufacturing.
When the White House request landed with Pentagon staff, the timeline reportedly compressed. After defense officials received that request. they asked Pentagon staff to move at an unusually rapid pace. with one person involved in the deal describing late nights and little sleep to push the loan through in a matter of weeks.
“The call came from the White House: We have to get this done,” the person said.
Defense Department funding for critical minerals is routed through an agency effort with high-stakes bipartisan goals. The Office of Strategic Capital. which started under the Biden administration. was built to address concern that China’s grip on rare-earth elements and other critical minerals threatens national security.
China’s dominance in the sector is stark. As of last year. China produced the world’s entire supply of samarium. an obscure rare-earth metal used in magnets that help guide Tomahawk missiles and start the engines in F-35 fighter jets. Other rare earths sit at the center of both commercial and military manufacturing—from car parts and semiconductors to drones. Finding raw materials is one hurdle; separating rare earths from the other materials they’re bonded to is another. It’s that separation process that China largely controls.
The Trump administration supersized the Office of Strategic Capital. It expanded the office’s lending authority from about $1 billion to $200 billion and changed how the office operated. according to interviews with more than a dozen people who worked there or interacted with it from the private sector or other parts of government. Where the Biden administration had set up an open application process that officials said was methodical—though slow and bureaucratic—Trump’s approach. in the words of one former Office of Strategic Capital official. was to go into the market and find what it wants instead of waiting for firms to apply.
That shift has fueled questions about what gets rewarded. People familiar with the office said the new leaders aimed to make as many deals as possible. including loans and investments in exchange for ownership stakes. They said the officials relied more on personal networks than applications to choose companies to fund.
So far, outside of Vulcan, a small number of other companies were selected, including Korea Zinc, a metal refiner; MP Materials, a Nevada rare-earth mining company; and ReElement Technologies, an Indiana producer of rare-earth elements and battery metals that partners with Vulcan.
The Pentagon’s announcement said loans to Vulcan and ReElement were conditional on the firms fulfilling certain legal and financial requirements. though it did not detail them. In a separate development. Bloomberg reported that the Pentagon may ultimately not lend to ReElement because of concerns over the company’s revenue projections and ability to scale up its technology discovered after the conditional loan was announced.
But the Vulcan deal has drawn the most scrutiny because of its timing and the web of connections around Trump Jr. A group of Democratic senators demanded an accounting of how Vulcan was awarded the loan. writing that conflicts of interest tied to the Trump family could be “resulting in a waste of taxpayer dollars and a threat to national security.” The Pentagon’s response did not address how Vulcan was selected. It explained only how the department addresses conflicts that arise from its employees’ financial holdings—not those of the president’s family.
On Capitol Hill, Democrats in the House tried to subpoena Trump Jr. to testify on the Vulcan deal but were blocked by Republicans. “Donald Trump Jr. must be made to answer whether the president’s son illegally profited from his father’s presidency,” Oregon Rep. Maxine Dexter said earlier this year.
Ethics experts outside politics also weighed in. Richard Painter, chief White House ethics lawyer during the George W. Bush administration. said aides to the president should not be intervening in contracting and lending decisions by agencies. particularly when those decisions financially benefit the president’s family.
“This is our money they’re spending,” Painter said. “This is corruption we pay for.”
The administration disputes any claim of favoritism. A White House spokesperson said the administration is working “in the best interest of the American people. ” adding: “The President’s entire team. including Senior Counselor Navarro and officials at the Department of War. is working together and with private industry to secure America’s critical mineral supply chain at Trump Speed.”.
Trump Jr.’s spokesperson said the president’s son does not discuss companies he has invested in with federal government officials and did not speak to Navarro about Vulcan. “He has no knowledge about how this deal came together,” the spokesperson said.
A spokesperson for 1789 Capital—the venture firm where Trump Jr. is a partner—said it played no role in Vulcan getting the loan and did not learn about the deal before it was public. “No company receives preferential treatment,” a Pentagon spokesperson said. “Outside affiliations, investors, or political connections play absolutely no role in the Department’s funding decisions.”.
For Vulcan, the payoff was swift and dramatic. The loan was one of many actions by the Trump administration that critics say helped companies tied to the Trump family; government contracts and other benefits have gone to various Trump-linked firms. prompting allegations of self-dealing by Democratic lawmakers and good government experts. ProPublica said the Vulcan loan is the first time a contract from a federal agency has been directly linked to White House intervention.
Vulcan’s rise came quickly. The company was launched in 2023 by a student at Harvard Business School. It began securing a series of relatively small defense contracts during the Biden administration. Its first manufacturing facility opened in March 2025; in an interview with its founder published that month. the firm’s funding at the time was less than $10 million. The rare-earth magnets Vulcan focuses on are needed for critical military technologies including drones and satellites.
The Pentagon’s deal was announced in November. It said it planned to lend $620 million to Vulcan and another $80 million to its partner, ReElement. Vulcan would also get $50 million in incentives from the Commerce Department. In exchange, the government would take a $50 million stake in Vulcan with the right to buy more later.
At the time, Vulcan had fewer than 50 employees. It said it would use the money to build a large new facility that would churn out thousands of tons of magnets a year, ramping up over the coming years and adding hundreds of new jobs.
The financial stakes extended beyond the Pentagon. In August 2025. Vulcan announced $65 million in investments. including from 1789 Capital—though neither 1789 nor Vulcan has publicly disclosed how much of a stake the venture firm has taken. Estimates of Vulcan’s valuation rose sharply after the deal was announced: around $200 million near the time 1789 Capital first invested to around $2 billion. according to Bloomberg.
Navarro’s role in initiating the deal was not publicly disclosed. Yet even if he did not discuss it with Trump Jr. the loan represented a win for someone Navarro considered a dear friend. In an October episode of Trump Jr.’s streaming show, “Triggered,” the two displayed their close bond. Trump Jr. called Navarro “my boy” and complimented him on the “jacked” physique he developed while in prison. Navarro called Trump Jr. “brother” and thanked him for his support “in my hardest of times.” Navarro has argued he was wrongly imprisoned for not complying with a congressional subpoena because he was protected by executive privilege.
Although Vulcan was not mentioned in that episode, the two spoke about rare earths—an area Navarro frequently discussed publicly. Navarro said: “China has revealed itself with this rare-earth issue as a country which is using the weaponization of their manufacturing floor. their supply chains. to exert pressure. not just on the United States. but to every other country that might do something that gets in the way of the Chinese dream of world domination. That’s what we’re fighting now.”.
The Pentagon says it is moving fast to close high-impact gaps. When asked about the Vulcan deal being expedited. the Pentagon spokesperson said defense officials balance “lightning speed with rigorous diligence to close high-impact deals that directly strengthen America’s defense and empower our warfighters.”.
Even so. the reported sequence remains at the center of the controversy: staff moving “in a matter of weeks” after a White House request; Vulcan being the only deal initiated by a top aide to the president among dozens Pentagon considered at the time; and the administration maintaining that neither Trump Jr. nor outside political connections played a role in funding decisions.
The broader deployment of funds is expected to continue. The Office of Strategic Capital is expected to deploy billions more in loans in the coming months to critical mineral and military technology companies.
Other companies under review illustrate how contentious the process has become. Among them was Unusual Machines, a Florida drone parts maker, where Trump Jr. sits on the advisory board and holds millions of dollars worth of shares. The Pentagon was accused of cronyism last year when it awarded the company a contract to make drone engines for the Army.
Competition for the limited pool of deals is now part scramble, part strategy. Brodie Sutherland. CEO of Nevada-based tungsten mining company Patriot Critical Minerals. told ProPublica last month that his firm had hired a lobbyist who knew someone previously connected to the Office of Strategic Capital and could introduce the company to a current staffer.
Sutherland said the experience reflects how the industry works. “It’s like any industry: A lot of what it is,” he said. “is who you know.”
He added that his company had had conversations with Pentagon staff and he was optimistic it could get funding. “Whether you need someone on the inside track to get it across the line I don’t know,” he said. “We’re hopeful you don’t need to be chums with Trump Jr. to get a project across.”
Defense Department records reviewed recently by ProPublica show Sutherland’s company had already been considered for a loan but was rejected. The records did not say why, and Sutherland said he still hoped Patriot Critical Minerals could secure some kind of Pentagon funding in the future.
For Vulcan, the deal has already reshaped its trajectory. When the Office of Strategic Capital made the move. staff learned of the White House request around September or October. an official involved said. It remains unclear how the White House request was delivered or whether it was framed as an order or recommendation.
Companies considered for funding are generally vetted for many months, the person said. But this one, the person described, moved quickly because it was treated as a White House priority.
Navarro did not respond to questions from ProPublica sent to him directly. Neither did Vulcan.
In the end. even as the Pentagon continues building loans meant to protect national security supply chains. the reported involvement of the White House in one of the most consequential deals—$620 million to a company tied to Trump Jr.—has turned the conversation toward the same point critics keep returning to: who gets in front of the window first. and what that means when public money and private stakes overlap.
Vulcan Elements $620 million loan Office of Strategic Capital Peter Navarro Donald Trump Jr. rare earth magnets Pentagon lending U.S. critical minerals cronyism 1789 Capital ReElement Technologies Maxine Dexter