Russell Laffitte, former CEO of Palmetto State Bank in Hampton, South Carolina, was sentenced to seven years in prison for aiding Alex Murdaugh, the convicted murderer and disbarred lawyer, in a fraud case Tuesday.
Last November, Laffitte was convicted of wire fraud, bank fraud and misapplication of bank funds as a conservator to former personal injury attorney Murdaugh. The trial detailed a decade-long collaboration that involved stealing and mismanaging money from Murdaugh's personal injury clients, many of whom were children at the time.
"Russell Laffitte used his position of power and trust to steal from unusually vulnerable victims," said U.S. Attorney Adair F. Boroughs in a press release. "His crimes undermine the public's trust in the judicial and banking systems."
In addition to his sentence, Laffitte has been ordered to pay almost $3.6 million dollars in restitution to victims.
Laffitte has said he intends to appeal the sentence. His attorneys, Mark Moore and Michael Parente of Maynard Nexsen, argued that Laffitte was a pawn in Murdaugh's scheme and not an active conspirator,
The attorneys declined to publicly comment at this time.
The initial indictment highlighted that Laffitte, who was an officer at Palmetto at the time, and his co-conspirators "knowingly and intentionally" engaged in a scheme to defraud Murdaugh's personal injury clients.
Murdaugh had also been charged for these crimes and others in late 2021, piling up to 71 separate charges involving several million stolen dollars. But in March 2023, he was convicted of the murder of his wife and son, who were found dead of gunshot wounds near the dog kennels of the family's Hampton County hunting estate.
After Laffitte's indictment, the banker called Murdaugh a "manipulative egomaniac" who used him "like a pawn to facilitate the theft" on a
"We knew him, we knew his family," said Laffitte. "He would always come up with money. He may have borrowed it from other people. It was not that uncommon for him to have a shortfall during the year and then pay it off."
The indictment details four client relationships that Laffitte explicitly took advantage of, making false statements and omitting facts regarding their bank accounts.
U.S. District Judge Richard Gergel who handed down the sentence told the Post and Courier that Laffitte treated victims like "players on a chessboard."
In one instance in 2011, young sisters Alania Spohn and Hannah Plyler, who lost their mother and brother in a car crash, hired Murdaugh to manage their finances until they turned 18.
Laffitte paid himself $355,000 and Murdaugh $990,000 with funds from the sisters' conservatorship account, according to the indictment.
In a courthouse-steps TV interview with ABC News, Ronnie Richter, the sisters' attorney, said, "We're trying on a broader scale to deter that same kind of conduct. I think the message and the verdict is going to do just that."
The indictment said that such transfers were made when Murdaugh's accounts went into overdraft of several hundred thousands. Laffitte also oversaw Murdaugh moving funds between victims' accounts to manage the discrepancies.
Laffitte also re-directed disbursement checks meant for the conservator accounts back to Murdaugh's personal accounts, and collected fees for his own conservatorship on accounts where he "never managed the money," according to the indictment.
"I would think a lot of banks built on relationships are probably seeing what happened and are making sure that they don't have similar lack of safeguards," said Nathan Williams, an attorney and former criminal chief in the U.S. Attorney's Office in the District of South Carolina. "It certainly shows how those types of relationships can get out of hand and can become aggravated."
