Former banker Russell Lucius Laffitte, age 54, has admitted guilt in federal court to conspiracy, wire fraud, bank fraud, and misapplication of bank funds. His guilty plea comes after being convicted of the same charges in 2022, a conviction that was later overturned by an appeals court.
"Russell Laffitte and Alex Murdaugh abused their positions of power to victimize people who trusted them," stated Ben Garner from the U.S. Attorney’s Office Criminal Division. Garner emphasized the collaborative effort of the FBI, SLED, and the South Carolina Attorney General’s Office in bringing forth justice.
Laffitte, once an executive at Hampton's Palmetto State Bank, worked with co-conspirator Alex Murdaugh, a local personal injury lawyer. Laffitte confessed to exploiting his conservator and personal representative roles for Murdaugh’s clients, extending undisclosed loans to himself and Murdaugh from the clients' accounts.
In a fraudulent scheme, Murdaugh had law firm checks issued to Palmetto State Bank. Laffitte, aware of the dubious nature of the checks, conducted transactions benefitting Murdaugh with client funds. One particular transaction involved disbursing over $1.3 million of a client's settlement funds for Murdaugh’s use.
Laffitte received illegal fees and failed to disclose them in tax returns, strategically directing funds to bank accounts to obscure the transactions.
Beyond these schemes, Laffitte misapplied bank resources, including diverting funds meant for farming to settle Murdaugh’s debts. In one instance, Laffitte allocated funds for fictitious beach house improvements, masking a transfer to cover Murdaugh’s overdrafts.
In response to Murdaugh’s theft discovering case, Laffitte footed $680,000 from the bank’s resources to mitigate the fallout, bypassing regular board approvals.
The plea deal mandates Laffitte to pay about $3.6 million in restitution and bars him from future roles in federally insured financial institutions without approval.
If Laffitte adheres to the agreement, his sentence will likely be five years in prison, with no further charges pending. U.S. District Judge Richard M. Gergel has agreed to this plea and is to determine the sentence soon.
The investigation was handled by the FBI Columbia Field Office and the South Carolina Law Enforcement Division, with prosecution led by Assistant U.S. Attorneys Emily Limehouse, Kathleen Stoughton, and Winston Holliday.
