FTX Broker Ordered to Repay Millions After Misusing Funds

An FTX claims broker with experience in Mt Gox, Celsius, and Voyager Digital cases has been mandated to return $1.9 million after using embezzled funds for personal luxury and crypto investments.

Thomas Braziel, the founder of crypto bankruptcy claims firms 117 Partners and 507 Capital, was found guilty of misappropriating funds from a receivership linked to the bankrupt firm Fund.com. According to the Wall Street Journal, a Delaware court ruled last Thursday that Braziel misused the assets he was supposed to liquidate and distribute to investors.

Instead of fulfilling his fiduciary duties, Braziel indulged in a lavish lifestyle, spending $1 million on hotels, clothing, art, and high-end jewelry, including a sapphire ring and emerald earrings. He also diverted funds into cryptocurrency, other bankruptcy claims, high-risk stocks, and leveraged loans.

117 Partners has reportedly handled $300 million in FTX bankruptcy claims, and 507 Capital acquired nearly 4,000 Bitcoin in Mt. Gox claims for $1 million.

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The embezzlement investigation into Braziel began in 2022 after a shareholder accused him of stealing $3 million. Despite attempts to hide his misdeeds, Braziel eventually conceded to the findings. He has been ordered to repay the amount within 20 days.

Braziel had posted on Thursday, “I’m on a wave — I’m very lucky — but I’m not letting go,” though this message has since been deleted.

Alexander Stefanov

With over 8 years of experience in the cryptocurrency and blockchain industry, Alexander is a seasoned content creator and market analyst dedicated to making digital assets more accessible and understandable. He specializes in breaking down complex crypto trends, analyzing market movements, and producing insightful content aimed at educating both newcomers and seasoned investors. Alexander has built a reputation for delivering timely and accurate analysis, while keeping a close eye on regulatory developments, emerging technologies, and macroeconomic trends that shape the future of digital finance. His work is rooted in a passion for innovation and a firm belief that widespread education is key to accelerating global crypto adoption.