Ex-attorney Murdaugh looms over fraud trial of his banker

CHARLESTON, S.C. (AP) — A banker accused of helping disbarred attorney Alex Murdaugh take money from the legal settlements of clients is the first person to stand trial in the sprawling rural South Carolina legal drama that has captivated true-crime audiences.

Former Palmetto State Bank CEO Russell Laffitte faces wire fraud and bank fraud charges in federal court. And even though no one has connected Laffitte to the murder charges against Murdaugh in the deaths of Murdaugh’s wife and son, that case immediately popped up as Laffitte’s trial started this week.

According to news outlets, an employee at Murdaugh’s law firm testified about the firm’s links with Laffitte’s bank and said she confronted Murdaugh about missing fees from one of his cases on June 7, 2021.

Murdaugh’s wife and son were shot to death that night. Neither prosecutors in Laffitte’s, nor the investigators in the killings have mentioned whether they see a link between the events.

Meanwhile, Murdaugh is playing a key role in Laffitte’s defense. So far, cross-examination by his attorneys has focused on how Murdaugh manipulated people and lied. The defense said Laffitte was only following Murdaugh’s instructions and didn’t willfully participate in the fraud, which prosecutors need to prove to get a conviction.

Defense lawyers wanted to call Murdaugh as a witness, but Murdaugh’s attorneys said he would invoke his Fifth Amendment right to avoid self-incrimination since he could face charges. The judge has said he would only allow Murdaugh to take the stand if he had something substantial to say.

Prosecutors said Laffitte knew what he was doing when he effectively worked as Murdaugh’s personal banker and eventually became the court-appointed custodian for the settlement money for several of his underage clients.

Laffitte loaned Murdaugh and himself money from those settlements, diverting that money from personal injury or death cases.

The trial is expected to last into next week in federal court in Charleston.

Murdaugh was disbarred and Laffitte was fired last year.

Murdaugh’s murder trial in the deaths of his wife Maggie, 52, and their 22-year-old son, Paul, is expected to begin in January. Murdaugh has repeatedly said he did not kill them.

Murdaugh is not charged in the ongoing federal bank fraud case, but he faces dozens of other charges in state court, including allegations that he helped run a money laundering and drug ring. He has also been accused of stealing more than $8 million in settlements he obtained in wrongful death and injury cases.

Both Murdaugh and Laffitte are from tiny Hampton County. Murdaugh’s family law firm dominated the legal community and his father, grandfather and great-grandfather were the area’s elected prosecutors for 87 years straight.

Laffitte’s family built Palmetto State Bank, earning a sterling reputation that led to honors like being named banker of the year by the Independent Banks of South Carolina in 2019.

And, as in many small towns, their families intertwined. The law firm employee who confronted Murdaugh about the missing money the day his wife and son died was Jeanne Seckinger, Laffitte’s sister-in-law.

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