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By Mike Stone WASHINGTON (Reuters) -The much-needed modernization of the U.S. Army's battlefield communications network being undertaken by Anduril, Palantir and others is rife with "fundamental security" problems and vulnerabilities, and should be treated as a "very high risk," according to a recent internal Army memo. The two Silicon Valley companies, led by allies of U.S. President Donald Trump, have gained access to the Pentagon's lucrative flow of contracts on the promise of quickly providing less expensive and more sophisticated weapons than the Pentagon's longstanding arms providers.   Military drone and software maker Anduril boasted it had a prototype of the NGC2 communications platform working during a battlefield test just eight weeks after winning the contract award. But the September 5 memo provides fodder for critics who argue that Silicon Valley’s move-fast, break-things ethos may not be the best approach for vital military equipment.  The memo from the Army's chief technology officer about the NGC2 platform that connects soldiers, sensors, vehicles and commanders with real-time data paints a bleak security picture of the initial product. "We cannot control who sees what, we cannot see what users are doing, and we cannot verify that the software itself is secure," the memo says. Those concerns have been addressed already as part of the "normal process" of development, Anduril said. "The recent report reflects an outdated snapshot, not the current state of the program," the company said in a statement emailed to Reuters.  A Palantir spokesperson said, "No vulnerabilities were found in the Palantir platform." However, the Army internal memo written by Gabriele Chiulli, the Army chief technology officer authorizing official on the NGC2 prototype, said, "Given the current security posture of the platform and the hosted 3rd party applications the likelihood of an adversary gaining persistent undetectable access to the platform requires the system be treated as very high risk." Palantir stock closed down 7.5% on Friday. Anduril is not publicly traded, although company founder Palmer Luckey has said a public offering is planned. A September 30 article on Anduril’s website touted the NGC2 system’s performance during a live-fire exercise in Fort Carson, Colorado: "Soldiers fired 26 live missions with M777 howitzers on Fort Carson's live-fire ranges, running AXS side-by-side with legacy crews. The contrast was visible: one team struggling with delays, the other firing digitally in seconds." Leonel Garciga, Army chief information officer and Chiulli's supervisor, told Reuters in an interview on Friday that frank vendor communication is important. "I think there's only one application that still has some vulnerabilities that they were working on," Garciga said, adding that many issues were fixed within a matter of weeks and days. The Army CTO's assessment, seen by Reuters and first reported by Breaking Defense, comes just months after Anduril was awarded a $100 million contract to create a prototype of NGC2 with partners including Palantir, Microsoft and several smaller contractors. The memo said the system allows any authorized user to access all applications and data regardless of their clearance level or operational need. As a result, "Any user can potentially access and misuse sensitive" classified information, the memo states, with no logging to track their actions. Other deficiencies highlighted in the memo include the hosting of third-party applications that have not undergone Army security assessments. One application revealed 25 high-severity code vulnerabilities. Three additional applications under review each contain over 200 vulnerabilities requiring assessment, according to the document. Garciga said that next week the Palantir Federal Cloud Service, which the battlefield system relies on, could be approved by the Army to deploy software updates more quickly after receiving a milestone permission known as "continuous authority to operate." Palantir and Anduril are leading a new wave of defense firms aiming to transform the U.S. military with cutting-edge technologies, including drones, artificial intelligence and autonomous systems. Palantir, a data analytics firm known for its work with intelligence agencies, and Anduril have seen their valuations surge under Trump’s presidency, as Washington increasingly turns to Silicon Valley-style innovation to counter rising threats. Anduril recently signed a $159 million deal for an initial prototyping period to develop a night vision and mixed-reality system as part of the Soldier Borne Mission Command (formerly IVAS Next) program. Palantir signed a $480 million contract for Maven, an artificial intelligence tool that sifts through images and sensor data to provide battlefield analysis. (Reporting by Mike Stone; editing by Chris Sanders, Sergio Non and Leslie Adler)

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By Ross Kerber (Reuters) -Minnesota power regulators on Friday approved a $6.2 billion plan for a BlackRock unit and Canada Pension Plan to buy utility owner Allete, parent of Minnesota Power, saying recent modifications by the parties should address concerns about rates and clean-power investments. The 5-0 vote by the Minnesota Public Utilities Commission may reassure investors that BlackRock will be able to address regulatory and antitrust concerns as its Global Infrastructure Partners unit, which it bought last year, presses for more deals. Earlier this week, people familiar with the matter said the infrastructure unit was in talks to buy utility group AES. Separately, on Friday two people said the unit was in talks to buy a data center business backed by Macquarie. Company executives said the Minnesota deal, first announced last year, would help Allete to transition to clean energy sources. Opponents, including the environmental group Sierra Club, business customers and State Attorney General Keith Ellison, had raised concerns the agreement could lead to higher rates and did not guarantee that Minnesota Power could meet a requirement for state electricity to be carbon-free by 2040. At Friday's meeting, which was webcast, commissioners said recent modifications helped to ease their previous skepticism towards the deal. A filing from the companies indicates recent term changes will add benefits worth up to $258 million for utility stakeholders, including through a clean technology fund and via bill credits for consumers. Commissioner Hwikwon Ham, in comments made before the decision, said those modifications gave him confidence in the agreement and that the commission could review company rates "if they misbehave." Commission Chair Katie Sieben said Minnesota Power needs massive new investments to pay for projects such as a new transmission line to bring in hydropower from Manitoba. In a securities filing, leaders of BlackRock and Canada Pension Plan Investment Board praised the decision and said that, with all required regulatory approvals now secured, the transition is expected to close in late 2025. "We are committed to preserving Allete's legacy of intense community focus as it continues to provide safe, reliable, and affordable energy which is increasingly carbon-free for Northeastern Minnesota," said Global Infrastructure Partners' founding partner Jonathan Bram in the filing. Allete CEO Bethany Owen said the agreement positions the company "to meet the significant infrastructure demands of the clean-energy transition" without compromising service, reliability, or affordability. Several groups voiced criticism towards the decision, including the Private Equity Stakeholder Project and the Sierra Club, which said it remains concerned about rates and that it is not certain the investors would provide capital for less-polluting energy. (Reporting by Ross Kerber; Editing by Edmund Klamann)

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By Jarrett Renshaw, Ernest Scheyder and Gram Slattery (Reuters) -Trump administration officials have discussed taking a stake in Critical Metals Corp, four people familiar with the discussions told Reuters, which would give Washington a direct interest in the largest rare earths project in Greenland, the Arctic territory that President Donald Trump once suggested buying. If finalized, the deal would mark the latest political twist for the Tanbreez rare earths deposit, which former President Joe Biden successfully lobbied to have sold to New York-based Critical Metals for far less than a Chinese firm was offering. Washington has recently taken stakes in Lithium Americas and MP Materials, underscoring Trump's desire for the U.S. to benefit from growing production of minerals used across the global economy. Details of the discussions about Washington's interest in an equity stake in Critical Metals have not previously been reported. The four sources declined to be named, citing the sensitivity of the negotiations. "Hundreds of companies are approaching us trying to get the administration to invest in their critical minerals projects," a senior Trump administration official told Reuters in response to a request for comment. "There is absolutely nothing close with this company at this time." Critical Metals did not respond to repeated requests for comment via email and phone. Greenland is a semi-autonomous part of Denmark and the Danish Embassy in Washington did not immediately respond to a request for comment. Rare earths offer strong magnetic properties critical to high-tech industries ranging from electric vehicles to missile systems. Their importance is spurring an intense push for fresh supplies by Western countries looking to lessen their dependence on China's near total control of their extraction and processing. Critical Metals, which agreed to buy Greenland's Tanbreez deposit last year for $5 million in cash and $211 million in stock, applied in June for a $50 million grant through the Defense Production Act, a Cold War-era piece of legislation aimed at boosting production of goods for national security purposes. In the last six weeks, though, the administration has begun discussions with the company about converting the grant into an equity stake, three of the sources said. If the deal goes through, a $50 million conversion would mean a roughly 8% stake in the company, although negotiations are not final and the final size of the stake could be higher or the deal itself could collapse, the same three sources said. Administration officials have considered reallocating $2 billion from the CHIPS Act to fund critical minerals projects, Reuters reported in August. The law, formally known as the CHIPS and Science Act, was signed into law by then-President Joe Biden in 2022 and aims to lure chip production away from Asia. The Critical Metals investment discussions were delayed by the administration's negotiations in recent days for a 5% stake in Lithium Americas, two of the sources said. The U.S. government shutdown is not expected to affect the negotiations, given that high-level staff involved in the discussions are considered essential government workers, two of the sources said. Part of the discussion centers on how warrants would be issued to give Washington the stake, one of the sources said. Warrants give their holders the right to buy stock at a set price. The equity stake would be separate from a $120 million loan the U.S. Export-Import Bank (EXIM) is considering to help the company develop Tanbreez, according to two of the sources. An EXIM spokesperson was not immediately available to comment. GREENLAND'S APPEAL Even before Trump expressed an interest in acquiring Greenland, Washington had long-running economic interests in the Danish territory. Biden officials were visiting Greenland's capital Nuuk as recently as last November trying to woo additional private investment in the island's mining sector. Trump also sent Vice President JD Vance to the island in March. One of the largest U.S. Air Force bases is in northern Greenland. The Tanbreez project is expected to cost $290 million to bring into commercial production, the company has previously said. The EXIM loan would be used to fund technical work and get the mine to initial production by 2026. Once fully operational, the mine is expected to produce 85,000 metric tons per year of rare earths concentrate. The site also contains gallium, which China subjected to export restrictions last year, and tantalum. Greenland's mining sector has developed slowly in recent years, hindered by limited investor interest, bureaucratic challenges and environmental concerns. Currently, only two small mines are in operation. The remote, cold location of Tanbreez is seen posing challenges to its development, although the deposit is located near a major waterway. (Reporting by Jarrett Renshaw, Ernest Scheyder and Gram Slattery; Writing by Ernest Scheyder; Editing by Veronica Brown, Jason Neely and Edmund Klamann)

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(Reuters) -Movie star George Clooney said on Friday that U.S. President Donald Trump's threat to impose a 100% tariff on all films produced overseas was the wrong solution for a real issue.  Clooney spoke before the annual Albies awards ceremony in London, a program that he and his wife Amal created to recognize global human rights defenders. He said that Trump's take that movie industry jobs were leaving California was true, but that it's "because we don't have proper tax incentives or rebates like you do in New York."  George Clooney said that if Trump "wants to implement a federal incentive, that would match the kinds of incentives we get in Louisiana and New Jersey and New York, then I think that would make a big difference in helping out." Among the honorees at the Albies were Melinda French Gates, the ex-wife of Microsoft co-founder Bill Gates, for her decades of efforts to champion women's health and gender equality, along with Marty Baron, the former editor of the Washington Post and the Boston Globe for his media leadership, and Darren Walker, president of the Ford Foundation, who created a billion-dollar social bond in U.S. capital markets to stabilize non-profits during the COVID pandemic.  Two other honorees were Fatou Baldeh, a leading global voice on the dangers of female genital mutilation, and Jose Ruben Zamora, a Guatemalan journalist who has spent three decades investigating corruption. (Reporting by Natasha Montague in London;Editing by Shri Navaratnam)

(The article has been published through a syndicated feed. Except for the headline, the content has been published verbatim. Liability lies with original publisher.)