Russell Laffitte, a former bank executive and longtime business associate of convicted murderer and fraudster Alex Murdaugh, formally pleads guilty to federal bank fraud charges in South Carolina as part of a new plea agreement that reduces his potential prison time. The deal comes after Laffitte’s initial 2023 conviction was overturned by an appeals court, paving the way for a potential second trial that will now no longer take place.
Under the terms of the agreement, Laffitte admits to knowingly participating in financial crimes that helped Murdaugh siphon hundreds of thousands of dollars from clients, many of whom were vulnerable or unaware of the schemes. Laffitte, who formerly served as CEO of Palmetto State Bank, will now face a reduced sentence of five years in federal prison. This is down from the seven-year sentence that prosecutors and the judge originally considered in the wake of his initial conviction.
In court documents, Laffitte acknowledges misusing his authority at the bank to help Murdaugh exploit settlement funds from personal injury and wrongful death cases. Acting as a conservator and fiduciary for several of Murdaugh’s clients, Laffitte funneled money into Murdaugh’s personal accounts and approved suspicious transactions while overlooking glaring red flags.
The plea deal marks another chapter in the unraveling of the legal empire once associated with the Murdaugh family, a dynasty long considered untouchable in South Carolina’s Lowcountry legal and political circles. Alex Murdaugh, once a powerful personal injury attorney, was convicted in March 2023 of murdering his wife and son and is now serving two consecutive life sentences. Separate from his murder trial, Murdaugh faces over 100 financial charges related to theft, fraud, and money laundering—many of which involve Laffitte.
During his initial trial, Laffitte’s defense claimed he was manipulated by Murdaugh and believed the financial activities were legitimate. However, federal prosecutors painted a different picture—one of a seasoned banker who willingly engaged in criminal conduct and profited off of it. Jurors initially agreed with the prosecution in November 2023, convicting Laffitte on six federal charges, including wire fraud and conspiracy to commit bank fraud.
But in January 2024, the Fourth Circuit Court of Appeals overturned the verdict, citing juror misconduct and procedural errors during the trial. With a retrial looming, Laffitte opted to strike a plea deal, admitting guilt in exchange for a reduced sentence and avoiding further legal uncertainty.
In his statement to the court, Laffitte expresses remorse, saying, “I deeply regret my actions and the damage caused to the victims and to the community’s trust in Palmetto State Bank. I take full responsibility and am committed to making restitution where possible.”
The plea agreement also includes provisions for Laffitte to cooperate with ongoing federal investigations into related financial crimes involving Murdaugh and other potential co-conspirators. Sources close to the case suggest more indictments may be on the horizon as prosecutors expand their probe into the financial web surrounding the Murdaugh legal legacy.
Meanwhile, federal regulators are continuing to investigate Palmetto State Bank’s oversight and governance failures. The bank, which has deep roots in Hampton County, has faced mounting scrutiny for failing to catch years of financial misconduct involving both Laffitte and Murdaugh.
For many in South Carolina, the case serves as a reckoning with decades of unchecked power wielded by a small circle of elite legal professionals. Victims’ advocates and legal watchdogs say the guilty plea is a step toward justice, but more accountability is needed to fully expose the extent of the corruption.
