A former executive at a social media firm with close ties to President Donald Trump spent 200 days gambling at a South Florida Hard Rock casino in a single year, allegedly feeding $29 million of company money into slots.
That’s according to a federal lawsuit filed by X Strategies against its co-founder and former chairman and CFO, Derek Utley, whom the company accuses of embezzling at least $5 million to fund an extravagant lifestyle and gambling addiction.
X Strategies claims Utley won more than $26 million playing slots but lost $29 million, for a net loss of $3 million.
X Strategies, co-founded by Utley and Trump adviser Alex Bruesewitz in 2017, manages prominent Trump social media accounts, including Team Trump and Trump War Room.
Utley has disputed the lawsuit’s allegations and said they would be addressed through the legal process.
The 34-page complaint, filed September 18 in the US District Court for the Southern District of Florida, accuses Utley of exploiting his exclusive control over X Strategies’ finances to siphon off company funds beginning in 2021.
200 Days at Hard Rock
X Strategies claims Utley initially used casinos as a means of obscuring allegedly stolen funds, opening casino accounts where he mixed company money with cash from other sources.
He allegedly withdrew funds directly from X Strategies’ bank accounts at casino ATMs, claiming the withdrawals were expenses for entertaining clients. After gambling, he would deposit remaining funds into his personal casino accounts, according to the complaint.
The company claims Utley’s gambling developed into an addiction, adding that it doesn’t yet know how much Utley won or lost playing table games or other casino games.
Late-Night Call From Vegas
The alleged scheme began unraveling after businessman Michael Seifert joined X Strategies as president in 2026 and noticed the company’s cash reserves were millions of dollars below what its reported revenues and expenses suggested they should have been.
Around the same time, the company learned Utley had allegedly called a third party late at night from a Las Vegas casino and requested an urgent cash transfer, claiming X Strategies needed the money to make payroll the following morning.
The lawsuit claims Utley had actually suffered a substantial gambling loss and wanted additional money to continue gambling. X Strategies intervened and told the third party not to make the transfer.
Forensic Audit
A subsequent examination of the company’s finances allegedly uncovered large casino withdrawals and unexplained payments to Utley and businesses he controlled. X Strategies claims multiple banks had previously closed its accounts because of suspicious transactions.
An ongoing forensic audit has identified at least $5 million that X Strategies claims was embezzled. The lawsuit includes civil RICO, theft, fraud, breach of fiduciary duty, and other claims and seeks damages, potentially including treble damages.
X Strategies also wants a court to impose a trust over assets allegedly purchased with company money—including Utley’s casino winnings and any points, credits, perks, rewards, or player status he accumulated while gambling with the funds.