US Congress Probes Commerce Secretary Lutnick's Ties to Cantor Fitzgerald Deal

Democratic lawmakers in the United States have launched a comprehensive inquiry into the role of Cantor Fitzgerald, the former firm of Commerce Secretary Howard Lutnick, in a $1.6 billion U.S. government investment in critical minerals producer USA Rare Earth (USAR). This investigation centers on potential conflicts of interest and ethical considerations surrounding Secretary Lutnick and his previous financial firm. Lawmakers are questioning whether Cantor Fitzgerald unduly benefited from this arrangement and if Secretary Lutnick's actions during his tenure may have enriched his immediate family members and former company.

At the heart of the probe is the U.S. Commerce Department's agreement (through its CHIPS program) to provide USA Rare Earth with up to $1.6 billion in funding, including $277 million in federal funds and $1.3 billion in loans. In return, the government is set to acquire approximately a 10% equity stake in USA Rare Earth, comprising 16.1 million common shares and roughly 17.6 million warrants. Concurrently, USA Rare Earth raised $1.5 billion in private capital through a Private Investment in Public Equity (PIPE) transaction, for which Cantor Fitzgerald served as the lead placement agent.

The lawmakers leading the charge, including Democratic Senators Elizabeth Warren, Ron Wyden, Chris Van Hollen, and Representative Zoe Lofgren, highlight that Commerce Secretary Howard Lutnick led Cantor Fitzgerald for over three decades before transferring ownership to his children. His son, Brandon Lutnick, currently serves as the firm's chairman. Lawmakers express serious concerns that the connection between Secretary Lutnick's position at the Commerce Department and his former firm's role as an agent in this significant government-backed deal could potentially violate conflict-of-interest laws.

The CEO of USA Rare Earth reportedly attested to Secretary Lutnick's “decisive and personal involvement” in securing the deal, which was announced in January 2026. Secretary Lutnick himself publicly touted the investment, stating it was “essential to restoring U.S. critical mineral independence.” However, after failing to receive satisfactory answers to previous requests for information from Secretary Lutnick and USA Rare Earth's CEO, lawmakers expanded their inquiry to include Cantor Fitzgerald. This situation underscores the critical importance of transparency and accountability in government-backed investments.

This development is viewed within the broader economic and political context of the U.S. efforts to strengthen its supply chain for rare earth elements, which are crucial for national security and economic competitiveness. As the U.S. aims to reduce its reliance on foreign suppliers for these critical minerals, there is increasing scrutiny over how such large-scale government investments are structured and managed. The fact that USA Rare Earth is described as an “unproven” company, not yet having achieved commercial mining or magnet production, further intensifies this oversight.

Market analysts suggest that the outcome of this investigation could send significant signals regarding the future of U.S. critical mineral strategy and financial agreements between the government and the private sector. The lawmakers' demands for transparency and concerns over potential ethical breaches may lead to the implementation of stricter oversight mechanisms in similar projects. In the coming period, the disclosure of additional information requested from Cantor Fitzgerald and the progression of the inquiry will be closely monitored by both financial markets and policymakers.