Trump orders US government to cut ties with Anthropic, threatens 'criminal consequences'

Defense Secretary Pete Hegseth declared the AI company a supply chain risk.

President Donald Trump ordered U.S. government agencies to stop using Anthropic’s products, and Defense Secretary Pete Hegseth later designated the AI company a national security "supply-chain risk" -- amid a dispute with the Pentagon that hit a deadline Friday.

Following a 5 p.m. deadline for the company to agree to the Pentagon's terms, Hegseth posted a statement on social media saying he's moved to designate the company a supply chain risk --a designation usually reserved for foreign adversaries -- telling every defense contractor they can't use the company's AI.

"America’s warfighters will never be held hostage by the ideological whims of Big Tech," Hegseth said. "This decision is final."

He said the company will continue to provide the department its services for up to six months "to allow for a seamless transition" to a different service.

Ahead of the deadline Friday, President Donald Trump had posted on his social media platform that he was directing the federal government to stop using the company's products.

"I am directing EVERY Federal Agency in the United States Government to IMMEDIATELY CEASE all use of Anthropic's technology. We don't need it, we don't want it, and will not do business with them again! There will be a Six Month phase out period for Agencies like the Department of War who are using Anthropic's products, at various levels," Trump posted.

"Anthropic better get their act together, and be helpful during this phase out period, or I will use the Full Power of the Presidency to make them comply, with major civil and criminal consequences to follow," Trump added.

ABC News has reached out to Anthropic for comment.

Leading up to the Friday deadline, the AI company's CEO had made clear that despite threats from the Pentagon, they refuse to drop their two key demands: no use of its artificial intelligence for fully autonomous weapons -- meaning AI, not humans, making final battlefield targeting decisions -- and no mass domestic surveillance.

Anthropic told ABC News that amid negotiations, the latest contract language from the Pentagon does not fully commit that the military will not use their technology for those two use cases.

In fact, Anthropic said the "new language" added into the contract by the department would allow their safeguards to be "disregarded at will."

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"The contract language we received from the Department of War made virtually no progress on preventing Claude's use for mass surveillance of Americans or in fully autonomous weapons," Anthropic told ABC News.

The company added, "New language framed as compromise was paired with legalese that would allow those safeguards to be disregarded at will. Despite DOW's recent public statements, these narrow safeguards have been the crux of our negotiations for months."

Top members of the Senate Armed Services Committee have sent a private letter to Anthropic and the Pentagon, urging them to resolve their fight.

The Senate leaders are urging Defense Secretary Pete Hegseth and the CEO of Anthropic, Dario Amodei, to extend their negotiations and work with Congress to find a solution, according to the letter obtained by ABC News.

The Pentagon claims it has no intention of using Anthropic's AI for cases that involve mass domestic surveillance or autonomous kinetic operations. However, it says Anthropic's guardrails could jeopardize military operations.

"The Department has stated that it does not intend to conduct mass surveillance or use autonomous weapons without humans on the loop -- positions that we in Congress endorse," the letter from the Senate leaders reads. "It is clear, however, that the issue of 'lawful use' requires additional work by all stakeholders. We must determine whether additional legislative or regulatory language is required, and, if so, what that law and regulation should entail."

"By Friday, February 27, the DOD could essentially declare war not on a foreign nation but on one of America's most successful frontier AI companies if it does not bow to its demands," Adam Conner, the vice president for technology policy at American Progress, wrote in an article on their website.

"This would be an unprecedented and unnecessary peacetime move that sends the signal to other private companies that they must do the Trump administration's bidding or face existential consequences," Conner wrote.