While Michael Grimes was at Morgan Stanley, he worked with Elon Musk — now a close Trump adviser — on his purchase of Twitter.

The Commerce Department is tapping former Morgan Stanley banker Michael Grimes to lead a planned sovereign wealth fund, part of USPresident Donald Trump’s effort to give the US a stake in projects he considers critical to national security.

Grimes, who left the bank after 30 years to join the new administration, is set to join the Commerce Department to oversee the fund, according to people familiar with the matter who asked not to be identified discussing matters that aren’t yet public. 

While the idea is still in the early stages and much remains subject to change, the fund would be part of a larger public-private collaborative effort to open up large-scale institutional investment options.

The Commerce Department didn’t immediately respond to a request for comment. Grimes couldn’t immediately be reached for comment. While he was at Morgan Stanley, he worked with Elon Musk — now a close Trump adviser — on his purchase of Twitter, Bloomberg reported.

The move shows the administration is moving forward with an executive order Trump issued in February on the sovereign fund idea. The president floated the idea on the campaign trail last year as a vehicle to funnel money from tariffs to invest in manufacturing hubs, defense and medical research. The current planning for the fund, which remains fluid, would not involve collecting tariff revenue, one of the people said. 

Last month, the Treasury Department named JR Gibbens, a Wall Street and military veteran to advise on plans for the fund. 

One idea being floated is that the sovereign wealth fund would pair with the US International Development Finance and Export-Import Bank to act as a catalyst for American investment in areas considered national security priorities, according to one of the people.

Among those priorities, the person said, are critical minerals, rare earths, manufacturing, technology, defense technology and defense sourcing. Of particular interest will be targeting areas in which China holds a dominant market position that could be a national security threat.

Bloomberg News reported in January that Trump advisers had previously discussed how the DFC could use investments to deliver on the president’s ambitions for greater US influence over Greenland and Panama.

Backers of the agency said at the time it would be able to trigger hundreds of billions in geopolitically driven overseas commitments by some of America’s most powerful institutional investors.

Sovereign wealth funds typically exist in countries that have large foreign exchange reserves, like China, or revenue from the sale of oil or other commodities, like Norway and Saudi Arabia. The money is then invested into everything from stocks and bonds to infrastructure and technology.

The administration is looking at other sovereign wealth funds like the Abu Dhabi Investment Authority, Saudi Arabia’s Public Investment Fund, and Norges Bank Investment Management as a road map for what the American sovereign wealth fund could be, according to the people.

The news about Grimes was reported earlier Wednesday by Reuters.