The political consulting firm that runs President Donald Trump’s social media accounts sued its co-founder in federal court, alleging he embezzled and laundered money for his own personal benefit.
The lawsuit, which was filed Friday in Florida, accuses Derek Utley of embezzling at least $5 million from X Strategies, the firm he co-founded with Alex Bruesewitz, a Trump adviser who runs the Trump War Room and Team Trump social media channels.
Utley allegedly used the siphoned money from 2021 to 2026 to gamble at casinos and purchase luxury sports cars, designer clothing, jewelry and first-class travel, according to the lawsuit.
He stepped down from his position at X Strategies in April, according to a court exhibit. Utley is now a partner at advisory firm Tower Strategies, where he leads its communications arm.
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The lawsuit, first reported by Politico, seeks to “recover those stolen funds, to hold Utley and his co-conspirators accountable, and to prevent him from causing further harm to X Strategies.”
The lawsuit also named two of Utley’s other businesses: Dicenzo Fitness, which the lawsuit says was used to embezzle money, and Stark Defense Industries, which allegedly holds funds from the consulting firm.
“Utley disguised personal expenditures as business expenses, laundered and gambled stolen funds at casinos (keeping the winnings for himself, if he won, but causing X Strategies to absorb the losses — he lost far more than he won), diverted company funds to personal investments and to Stark Industries and Dicenzo Fitness (entities owned and controlled by Utley), and fabricated financial records to conceal his embezzlement,” the lawsuit reads.
Utley could not be reached for comment. He told Politico that he disputed “these allegations in the complaint and will address them through the legal process. I have no further comment at this time.”
The lawsuit claims that Utley covered up the alleged embezzlement by keeping “incomplete and confusing books” and by fabricating financial records. X Strategies President Michael Seifert initiated an audit after noticing discrepancies with the firm’s finances, the suit says, leading to a confrontation in which Utley initially denied wrongdoing.
He later admitted to Seifert that he “stole millions of dollars from X Strategies,” the suit reads, and “blamed the theft on his low self-esteem, his desire to have more influence and impress others, and his gambling and alcohol addictions.”
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