A member of Congress was able to invest in Elon Musk's privately held AI and social media company xAI recently. That investment is drawing concerns of insider trading, given the timing before the Pentagon announced a deal with xAI. Here's what the congressional member had to say.
Congresswoman Buys xAI, Laughs Off Insider Trading
Rep. Lisa McClain (R-Mich.) recently disclosed buying $100,000 to $250,000 in stock of privately held xAI, according to the Benzinga Government Trades page.
The transaction came as part of xAI's recent funding round, which included investments from NVIDIA Corporation (NASDAQ:NVDA) and Cisco (NASDAQ:CSCO).
The investment in xAI, which was done by McClain's husband, came days before the AI company announced a deal with the Pentagon to deploy the Grok chatbot for military use.
Defense Secretary Pete Hegseth provided more commentary on the xAI partnership earlier this week.
"Very soon we will have the world's leading AI models on every unclassified and classified network throughout our department," Hegseth said, as reported by NBC News.
In an interview with NewsNation, McClain was asked about the investment. McClain said her and her husband had no knowledge of the Pentagon deal and it was not insider trading.
"Because if it was, we wouldn't have bought 100,000 shares, we would've bought a heck of a lot more," McClain said.
McClain laughed when asked the question. The comment on 100,000 shares may refer to the investment being for $100,000, as 100,000 shares of the privately traded company would likely be worth more than her disclosed investment.
"I can 100% assure you that we didn't have the insider information"
Benzinga reached out to the congresswoman for comment.
During the interview, the congresswoman highlighted that the investment was made in a private company and noted that it was small compared to the capital raised by xAI.
While the congresswoman stated she was not guilty of insider trading, she said that this does happen among her peers in Congress, without providing examples.
"I think that's a very fair question to ask especially with all of the insider trading that happens up here."
Lisa McClain’s Investments
Members of Congress are currently allowed to invest in private companies as long as they disclose their investments, similar to their stock trades. Rep. Nancy Pelosi (D-Calif.) has disclosed investments in private companies in the past, including Databricks.
A report from Quiver Quantitative ranked McClain as the third top gainer among members of Congress for their investment portfolio gains in 2025. McClain had a gain of 37% in 2025, outpacing the 16.6% gain for the S&P 500.
Benzinga flagged the trading history of McClain, who is a high-ranking Republican member in Congress, which has raised red flags. McClain filed hundreds of stock transactions late in August. Among those trades included Palantir Technologies, a stock that has risen substantially since her purchase. The company’s government contracts have put a spotlight on members who own the stock.
McClain’s trading history in 2025 included hundreds of stock purchases, including multiple purchases of Tesla stock.
Musk has spoken out about Congress trading in the past, questioning how members of Congress have added so much to their wealth. In February 2025, he quote-tweeted a post about several Democratic members of Congress who have added to their wealth since taking office.
McClain’s wealth has grown by millions of dollars in recent years, according to data from Quiver Quantitative. With the investment in xAI, her wealth could increase in the future based on the success of Musk’s company.
Image via Adam McCullough/Shutterstock
