October 23, 2026
There was some grumbling in Congress when the Trump administration installed Stephen Feinberg, a billionaire from New York, as the second man in the Pentagon. Feinberg had previously led Cerberus Capital Management which has various financial interests in Pentagon purveyors. He had also been chair of the President's Intelligence Advisory Board from 2018 to 2021, during the first Trump administration.
Feinberg first made headlines when the Pentagon invested billions to take equity stakes in more than a dozen private businesses. There are serious concerns that Feinberg is directing money to businesses he himself and/or Donald Trump's family are interested in.
His newest endeavors though seem to be less concerned with business. They look like attempts to duplicate the Central Intelligence Agency within the Defense Department.
Two major pieces based on different 'leaks' about these plans were published today. That is hardly be a coincidence. Most likely these piece were seeded by 'sources' as part of a turf war.
The Washington Post is leading the pack:
Pentagon looks to build a deep-cover spy program to confront China ( archived) - Washington Post, Oct 22 2026
Economic espionage is a new priority at the Defense Department. But the Pentagon doesn't have a great track record with human spying.
The Pentagon is looking to build a more robust deep-cover spying program to conduct economic warfare against China and other U.S. competitors, according to half a dozen people familiar with the initiative.
This new next-generation spying program - in which U.S. operatives would go undercover as businesspeople or other private-sector personnel, without any overt U.S. government affiliation - is intended to be a covert prong of the Pentagon's larger economic warfare campaign, the people said.
This new spy program of "nonofficial cover officers," or NOCs, is being overseen by Tom Rakusan, a 39-year CIA veteran and now senior adviser to Deputy Defense Secretary Steve Feinberg, according to those familiar with it, who spoke on the condition of anonymity to discuss the sensitive initiative.
Rakusan, who retired from the CIA in 2021, rose to deputy director of operations - the CIA's top spy runner - in 2017. He later led the CIA's response to Russia's election-interference campaign in the 2016 presidential election.
After leaving the agency, Rakusan joined Cerberus Capital Management, the private equity firm co-founded by Feinberg, and followed the billionaire to the Pentagon in 2025.
Why the Pentagon needs to plant moles in foreign companies for economic spying when its immediate task is to fight wars against declared enemies is not clear. One should not be misled by the 'China' direction. The U.S. is well versed in spying on its allies.
The Pentagon plans seem to be inconsistent with current law. The CIA, which unlike the Pentagon is regularly involved in clandestine spying, is, for good reasons, pissed about the initiative:
The reaction inside Langley to the Pentagon initiative has been frosty, according to the former agency official. The CIA has traditionally been resistant to other agencies stepping on what it perceives as its core human-spying turf, insisting that such efforts be coordinated under the CIA chief of station in the country concerned.
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The military's Title 10 authorities allow for "Intelligence Preparation of the Battlefield," which the Pentagon has interpreted to allow a broad swath of espionage-related activities, including some far afield from narrow battlefield intelligence, former officials say.
U.S. intelligence agencies such as the CIA operate under Title 50 authorities, which govern their abilities to collect intelligence and conduct covert actions abroad.
Is there a bet yet when the first clandestine Pentagon agent stealing business secrets from European companies will be caught?
A second 'leaked' piece in today's Politico points to a different aspect of the new Pentagon unit:
The Pentagon is quietly building an elite new tech sabotage agency - Politico, Oct 22 2026
The creation of the Technology Support Office signals the Defense Department's intent to ramp up a range of aggressive covert activities abroad.
The Pentagon has spent months quietly building an elite new tech agency to help covertly disrupt and sabotage foreign technology programs considered threats to American military superiority.
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Information on the Technology Support Office, or TSO as it is called internally, is nearly impossible to find on Pentagon websites, and the agency is mentioned by name only in several previously unreported Defense Department historical records and memoranda.
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Deputy Defense Secretary Steve Feinberg, a private equity billionaire and former head of the White House's Intelligence Advisory Board during President Donald Trump's first term, led the push inside the Pentagon to create the new agency.
Tom Rakusan, a senior adviser to Feinberg at the Pentagon, has also been closely involved in setting up TSO.
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Hegseth and Feinberg established TSO quickly and without attracting outside scrutiny because they largely built the agency by reorganizing two classified Pentagon intelligence programs that have conducted similar clandestine tech-sabotage efforts at a smaller scale since 2023.
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TSO is staffed with engineers, special operators and intelligence officers, and its work spans everything from building bespoke hacking tools to planning elaborate deception operations that trick adversaries into installing faulty components - likely designed by TSO - in key foreign weapons platforms.
TSO's overarching goal is to "buy time or stop adversaries from developing technologies" that would most threaten the U.S. military in a major conflict, said a former U.S. intelligence official who worked closely with the agency.
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This summer, the Pentagon tapped Grant Hundley, a former Marine Corps special operations officer, to serve as TSO's director.
Hundley comes, like Feinberg, from a private equity grifter business. One task of the Pentagon's new TSO seems to be to spread money:
A second former Pentagon official and a former U.S. national security official said the agency has told some defense contractors it's interested in offensive hacking capabilities. The former senior Pentagon intelligence official estimated that its budget for classified contracts alone is likely north of $1.5 billion.
They are seeking contractors on "the leading edge of technology," that official said, and hope to procure "a whole host of tools wherever your imagination can go."
Both of the new initiatives, the clandestine economic warfare agents and the 'technical support' sabotage unit, are likely to end up in scandals.
This will probably be due to botched operations in allied countries, operations that exceed the legal framework the Pentagon is working under, or due to the not so hidden corruption when buying products from companies in which the Pentagon leaders have financial interests.
It takes a while for scandals come to the fore. Until then the pure existence of these units must be taken as a warning by U.S. allies that their economies and companies are in danger of becoming victims of these new Pentagon activities.
This article was originally published at Moon of Alabama.