Stephen Feinberg, the billionaire founder of Cerberus Capital Management, has quietly become one of the most powerful figures within the U.S. Department of Defense (DoD) since his appointment as deputy secretary of defense in March 2025. Despite his influential role, Feinberg remains highly reclusive, avoiding public appearances, congressional testimony, and media engagement since taking office.

Feinberg’s influence reportedly surpasses that of his superior, Defense Secretary Pete Hegseth, who remains more visible but whose authority appears limited in comparison. According to multiple officials across Capitol Hill, the Pentagon, and the defense contracting sector, Feinberg is deeply involved in virtually all major decisions and wields substantial control over the Pentagon’s procurement processes and industrial base strategy.

Unlike Hegseth, who has pursued controversial personnel policies and garnered public attention for outspoken remarks, Feinberg is perceived as focusing solely on reshaping the department’s acquisition and investment practices. His tenure has been characterized by a significant loosening of traditional defense contracting regulations. Critics and supporters alike describe this transformation as turning the Pentagon into something akin to a private equity operation, with Feinberg bringing longstanding associates from Cerberus into senior roles to implement these changes.

A former Pentagon official familiar with Feinberg’s methods stated that the deputy secretary favors installing trusted executives from his private equity firm, believing they are best equipped to overhaul government procedures. These efforts coincide with Cerberus’s broader investment portfolio, which aligns closely with Pentagon priorities, including ownership of Stratolaunch, a hypersonic weapons test company awarded a nearly $91 million contract earlier this year.

Cerberus also acquired M1 Support Services, a federal contractor providing training and operational support to the military, prior to Trump’s 2024 presidential election victory. The firm recently expanded with a new subsidiary based in Saudi Arabia, underscoring its growing presence in defense-related markets.

Although Feinberg officially divested from Cerberus and its managed funds upon joining the government, some lawmakers remain concerned about potential conflicts of interest. Senator Elizabeth Warren has expressed particular unease, highlighting that contracts awarded to Cerberus-affiliated companies—including projects tied to missile defense systems—pose ethical questions. In a letter to Feinberg, Warren urged greater scrutiny, emphasizing what she describes as a lack of relevant government management experience from Feinberg’s private equity background.

The Pentagon has firmly denied any conflicts of interest, with its spokesperson asserting Feinberg’s integrity and significant positive impact on the department’s operations. Meanwhile, Feinberg’s network has extended into new ventures, including the launch of a special-purpose acquisition company incorporated in the British Virgin Islands, which is linked to associates involved with Trump-related business enterprises.

As Feinberg continues to operate largely behind the scenes, analysts and officials watch closely to assess how his expansive control over defense spending and acquisition may reshape the U.S. military-industrial landscape in the coming years.