Guardian investigation revealed Pentagon AI chief Emil Michael's millions in disclosed Perplexity and Brex stock sales

On September 1, 2026, the Guardian reported that Emil Michael, the Pentagon's Under Secretary of Defense for Research and Engineering and the department's chief technology officer, sold his shares in Perplexity, an AI-powered search engine, in June 2026 for between $5 million and $25 million, according to Michael's financial disclosure filings. Michael had joined Perplexity's advisory board in 2024 and taken a personal loan from the company of between $250,000 and $500,000 at 4.57% interest; he resigned the advisory-board seat on entering federal service but kept his vested and unvested Perplexity equity, and the disclosures do not specify which stock he sold. In his ethics agreement, Michael pledged not to profit from the unvested portion of that stock.

The same reporting detailed a second disclosed stock sale by Michael during his Pentagon tenure. He sold his holdings in Brex LLC, a financial-software company where he had been a paid consultant, for at least $5 million in April 2026 -- a gain of at least 473% on a stake he had valued at up to $750,000 the year before -- around the time Brex was acquired by Capital One. The Guardian's reporting also detailed a third sale, of Michael's stake in xAI, which is recorded as its own entry at its established January 9, 2026 sale date rather than here, since that sale was independently reported months before this September disclosure story.

As Under Secretary for Research and Engineering, Michael oversees the department's dealings with AI companies and has driven its push to expand AI use across the military; the Lever reported in March 2026 that he was a central figure in the Pentagon's decision to blacklist AI company Anthropic, a Perplexity competitor, for refusing to allow its models to be used for mass surveillance and certain military applications, while holding his multimillion-dollar Perplexity stake. Perplexity separately obtained a General Services Administration contract in November 2025, though reporting has not established a direct tie to the Pentagon.

Richard Painter, a White House ethics lawyer under President George W. Bush, said Michael "should have sold all interest in the company before he started working" and that keeping the stock "would have raised questions because of appearances," even though it would not have violated the law. A Pentagon spokesperson said Michael and other defense officials "are in full compliance with ethics laws and regulations. Any claims otherwise are false," citing the department's "rigorous, multi-layered ethics framework."