Pete Hegseth, President-elect Donald Trump’s embattled pick for secretary of defense, received a six-figure severance payment and signed a non-disclosure agreement when he exited the organization Concerned Veterans of America. The payment came amid allegations of financial mismanagement, repeated incidents of intoxication and sexual impropriety, as well as dissension among its leaders over Hegseth’s foreign policy views.
The Army veteran turned Fox News host signed a non-disclosure agreement when he stepped down as CEO in January 2016, two sources associated with Concerned Veterans of America told CBS News, with one source saying the agreement included a financial payout. The CVA sources spoke to CBS News under conditions of anonymity because they were not authorized to publicly discuss legally-binding contracts, while also fearing professional reprisal.
Public tax filings reviewed by CBS News confirm that Hegseth was paid more than $172,000 between October 2016 and September 2017 – well after Hegseth’s formal departure from his role as CEO of Concerned Veterans from America in January 2016.
Hegseth remained listed on tax filings as a former CEO working 50 hours a week between 2016 and 2017. An archived 2016 biography on Hegseth’s website described him as a Fox News contributor and host, and did not list an ongoing role with Concerned Veterans for America.
In a statement to the Military Times at the time of his departure, Hegseth said he was leaving the organization to focus on releasing a book and other advocacy work, while CVA said it wished him well “in all future endeavors.”
Contacted by CBS News, Hegseth’s attorney, Timothy Parlatore, did not return a response before publication.
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Experts consulted by CBS News said severance payments and non-disclosure agreements for outgoing CEOs are common. Such payments are issued for a number of reasons, including to maintain professional relationships, to work as an adviser to an incoming CEO, or to provide a soft landing for departing leaders, they said.
Hegseth has contested the allegation that he was forced out of his CEO position. On Dec. 4 he retweeted a letter obtained by the New York Post on X, saying: “Read for yourself. You’ll see the truth is on our side.”
The letter, written on Concerned Veterans of American letterhead in January 2016, was authorized by Randy Lair, a trustee of the veterans’ advocacy group.
“The truth is Pete resigned his position as CEO of Concerned Veterans of America as a result of a difference of opinion as to the future of the organization and so that he could focus on other endeavors, including, his relationship with Fox News,” Lair wrote in part.
He added: “Pete was not terminated by the organization and, in fact, we at CVA worked with him though this difficult decision and mutually agreed the end of 2015 was the best timing for both parties…The bottom line is that Pete Hegseth voluntarily resigned his position and CVA recognizes and appreciates his accomplishments as CEO.”
Sources affiliated with Concerned Veterans of America at the time of Hegseth’s tenure told CBS News that there was a “difference of opinion” over Hegseth steering the organization toward advocacy for foreign policy views that championed military intervention. Senior leaders of the organization strongly opposed Hegseth’s foreign policy advocacy over its historical mission of backing conservative fixes to the Department of Veterans Affairs.
However, the sources also highlighted what Lair’s letter did not mention, specifically internal assessments of Hegseth’s handling of the organization’s finances and the alleged incidents of intoxication and sexual misconduct, which Hegseth and Parlatore, his attorney, have denied.
Hegseth’s financial record at Concerned Veterans for America
Hegseth led Vets for Economic Freedom Trust, operating as Concerned Veterans for America, from 2012 to 2016. Tax records show that, during three of the five years of his leadership, the organization spent more money than it raised from donations and other means.
Filings for October 2012 to September 2013 show the organization brought in $3.8 million but spent $3.9 million, representing a shortfall of $130,000. Hegseth’s CEO compensation is listed as $67,500.
Filings for October 2013 to September 2014 show revenue swelled $15.7 million but the organization spent $16.1 million — including $8.6 million on advertising and promotion — resulting in a shortfall of $428,000. Hegseth’s salary is listed as $144,894.
Filings for October 2014 to September 2015 show Hegseth’s salary grew to $182,549 and the organization ran a surplus for the first time since 2011, with revenue of $14.1 million and expenses of just under $14 million.
However, the organization again spent more than it raised the following year, when Hegseth was listed as the outgoing CEO. Filings for October 2015 to September 2016 show the organization raised just under $16 million but spent $16.4 million, resulting in a shortfall of $437,000.
The filings show expenses at the organization were slashed after Hegseth’s departure. From October 2016 to September 2017, compensation, salaries and wages were reduced to $2 million, down from almost $7 million the previous year. Spending on travel was reduced to $416,000, down from almost $2.4 million, and spending on conferences, conventions and meetings amounted to $124,000, down from $2.4 million.
Hegseth has denied allegations of financial mismanagement, repeated incidents of intoxication and sexual impropriety at the organization. In an op-ed in The Wall Street Journal published Dec. 4, Hegseth said, “We had hundreds of employees and thousands of volunteers — yet based on the anonymous accusations of a few disgruntled employees, the legacy media has made it sound as if we ran a college frat house. That’s just untrue.”
Allegations at Vets for Freedom
Prior to joining Concerned Veterans for America, Hegseth led Vets for Freedom (VFF) from 2007 to 2010, where he also faced allegations of financial mismanagement.
In 2008, the organization raised $8.7 million, but spent $9.1 million. Filings show it received a loan of $20,000 to “provide additional liquidity to the organization.”
The New Yorker reported that donors were concerned their money was being wasted and arranged for VFF to be merged with another organization, Military Families United, which took over most of its management.
Revenue at VFF dwindled to $268,000 by 2010 and by 2011, the organization’s revenue was listed as $22,000. Hegseth joined Concerned Veterans for America the following year.
Margaret Hoover, host of the PBS program “Firing Line” and a former adviser to Vets for Freedom, said in an interview on CNN that Hegseth had managed the organization “very poorly.” Hoover expressed doubt about his ability to run the sprawling Defense Department when he had struggled with a staff of less than 10 people, and a budget of under $10 million.
“I don’t know how he’s going to run an organization with an $857 billion budget, and 3 million individuals, based on what I saw in those years,” she said.
