Aaron Thomas, a former contestant on MasterChef Australia, has been slapped with a lawsuit by the very own company he founded. Mining firm Oakmont Resources alleged the former CEO embezzled $7.57 million from company money to fund his lavish lifestyle.

Oakmont Resources said an internal investigation discovered Mr Thomas had spent $US30,000 on a luxury jet charter, $US171,000 on a Tiffany & Co engagement ring for his Brazilian fiancée and $US53,000 on an Australian holiday. Other expenses charged to the company include over $US91,000 spent in Las Vegas, a holiday in Greece and a $US27,317 payment to a New York family law firm "in respect to what appears to be a custody matter" for his Brazilian fiancée.

"Thomas used the company bank accounts as a personal piggy bank, withdrawing substantial sums of money and transferring them to his personal accounts and to family and friends," the lawsuit said, noting those were just "a few examples of a widespread pattern of misappropriation uncovered by the forensic accountants."

Mr Thomas, when confronted with evidence of financial mismanagement, said he was entitled to the compensation he claimed. The lawsuit alleged the former CEO produced a "service contract" which "lacks a company seal, counter-signature of any other director, and does not exist in the company records."

Mr Thomas founded Oakmont Resources in 2010. It focuses on iron ore and owns operations in Brazil. The Oakmont board fired him in January 2014 upon the discovery of his dodgy spending.

The lawsuit alleged Mr Thomas was able to embezzle the funds since they were transferred as "salary" or as "director's remuneration." He failed to show proper authorisation or justification, the lawsuit said.

Mr Thomas told The New York Post he will file a countersuit. He said the lawsuit is an attempt by the Oakmont board to secure the 25 per cent of the company he still owns.

The 26-year-old appeared in the first season of MasterChef Australia in 2009, which was won by contestant Julie Goodwin.