Nikki Haley’s Hubby Tied to Shadowy Defense Firm

The latest financial disclosures from former South Carolina Gov. Nikki Haley reveal as much as a half-million dollars of her husband’s net worth derives from a mysterious “military technical services company”—an apparent shell entity tied to a government contractor seeking tax credits from her successor’s administration.

There is no evidence that Haley or her husband, Michael Haley, have broken any rules. However, the materials suggest the family could benefit financially from state and federal policy, including from the export of military equipment to Taiwan.

When Haley first submitted personal financial forms with the Federal Election Commission in May as part of her presidential bid, she declared among her husband’s “Employment, Assets, and Retirement Accounts” a company called Allied Defense LLC. The initial filing described this entity as a “start-up business, value not readily ascertainable” that had compensated the former Palmetto State first gentleman—a National Guard major who deployed to Africa in June—less than the minimum reportable amount of $201.

But the ex-governor, who gave up the mansion in Columbia to become then President Donald Trump’s United Nations ambassador in 2017, reappraised her spouse’s start-up in a subsequent update from July, now determining its worth to be between a quarter-million and a half-million dollars. It also added the “military technical services” descriptor.

The form offers no further details about Allied Defense LLC. But public filings proffer additional insight.

Only three companies nationwide have that name. One is an active shooter training outfit in Michigan, another is a small but long-standing Defense Department contractor now operating out of Florida, but previously based in Maryland and Virginia.

But a Haley campaign spokesperson confirmed that the aspiring first spouse’s Allied Defense is a firm incorporated in their home state of South Carolina on Jan. 22, 2021—two days after the end of the Trump administration, though more than two years after Haley exited her UN post.

In its filings with the state, this Allied Defense has used three addresses in coastal Charleston County, South Carolina, home to one of the state’s military air bases and to the $2.4 million mansion the Haleys acquired in 2019. Small Business Administration records show the firm engages in the “design and manufacturing of military vehicles,” among other services, and has registered to export vehicles to Taiwan.

But Charleston County authorities revealed to The Daily Beast that Allied Defense does not have a license to conduct business there. The Daily Beast further found that the company pays no real or personal property taxes for any assets within the county.

Combined, these would mean Allied Defense legally can have no economic activity at the locations it purports to operate from. A Haley campaign spokesperson maintained that Allied Defense had registered to conduct business in the county, contradicting the local department of revenue, though the campaign did not provide a date on which it had done so. The spokesperson further asserted that “there was no income for Allied Defense in prior years because it was a startup.” This would not, however, explain why the company failed to pay personal property taxes, which apply to any equipment and even furniture that a business owns within county limits.

What definitely does have assets, and a license to do business, at Allied Defense’s Charleston County addresses is a larger pre-existing firm with some $1.8 million in military contracts: Defense Engineering Services—which also pays the taxes at these facilities.

And between Haley’s first disclosure in May and her update in July, Defense Engineering Services completed a much-ballyhooed expansion into new digs in Charleston County. Just four days before DES announced it was “up and running” in the 53,000-square-foot space in June, Allied Defense changed its address in a filing with the state to this exact location, having been previously registered at a different DES facility. And the signatory on the June filing was DES co-founder Robert Cole.

Neither Cole nor DES’s other principle, Greg Gordon, answered repeated questions from The Daily Beast about Allied Defense’s work or lack thereof. Neither would Donald Cinnamond, listed as Allied Defense’s CEO on the SBA paperwork and as its point of contact in the Defense Logistics Agency’s Commercial and Government Entity Program, a registry of firms eligible to do business with the U.S. military.

Similarly, none of these men responded to queries about a relationship with Major Haley, whose name does not appear in any official paperwork associated with Allied Defense. However, a Haley campaign spokesperson confirmed to the The Daily Beast that “two owners of Defense Engineering have a stake in Allied Defense.” But Team Haley denied that Michael Haley had anything to do with the parent firm.

“Michael is not involved in Defense Engineering,” the spokesperson wrote in an email to The Daily Beast. “Michael has no knowledge of anything related to Defense Engineering. He is not part of that business.”

The Daily Beast located a website for Allied Defense registered to Gordon’s name and to his DES email address, and to one of the Charleston County addresses that Allied Defense and DES share.

“Allied Defense was formed by bringing together a multidisciplinary team to assist the U.S. Government and U.S. ally countries with security and defense matters around the globe,” the firm’s “About” page reads. “Our approach is to combine our political, legal, military, engineering, and manufacturing expertise to derive policy and technical solutions for our customers. When part of the solution is military hardware and systems, our network of providers and manufacturers is ready to support the cause. Today, Allied Defense aims to increase world peace by ensuring that those who protect our freedom and way of life are equipped with the right tools to do so.”

Allied Defense expands on its offerings on the “Services” page, where it says it can “navigate political and legal concerns to allow for defense system acquisition,” connect clients with a “​​network of manufacturers [that] regularly deliver hardware and software solutions” from “armored vehicles to sophisticated electronics,” and even “coordinate specifications and requirements with ally militaries and international peacekeeping forces.”

Questions sent to an email address listed on the site about how Allied Defense does this work without a business license or paying taxes in its home county went unanswered.

The South Carolina-based Allied Defense has no government contracts viewable in any public database. By contrast, DES received its first six-figure research and development grant in 2020, and a $1.7 million contract to work on advanced circuit breaker technology in late 2022.

The company has also sought other government benefits.

When current South Carolina Gov. Henry McMaster—Haley’s former lieutenant governor and appointee to the state Ports Authority—announced DES’ $2.25 million expansion in April, his administration also announced it had approved “job development credits” to help underwrite the project. However, the state Department of Commerce told The Daily Beast the company had not yet finalized the deal.

A spokesperson for the agency denied knowledge of any connection between DES and Maj. Haley.

On reviewing The Daily Beast’s filings, Nick Schwellenbach—senior investigator at the nonprofit Project on Government Oversight—called for transparency from all parties, raising concerns that Haley’s partners at Allied Defense could attempt to capitalize on his political ties.

“There are questions about this murky situation that need answers,” Schwellenbach said. “When a company with government business has an arrangement with a politically connected person, it can easily look like the company’s aim is influence peddling.”

Read more at The Daily Beast.

Get the Daily Beast's biggest scoops and scandals delivered right to your inbox. Sign up now.

Stay informed and gain unlimited access to the Daily Beast's unmatched reporting. Subscribe now.