Former Hampton County banker granted $500K bond on federal charges

A former Hampton County, S.C., banker allegedly involved in financial conspiracies with disbarred attorney Richard "Alex" Murdaugh received his first day in federal court this week.

On Wednesday, ex-Palmetto State Bank CEO Russell Laffitte received a bond hearing and formal arraignment on a five-count federal indictment unsealed on July 20, when a federal grand jury charged him with conspiracy to commit wire fraud and bank fraud, bank fraud, wire fraud, and misapplication of bank funds.

Related news: Former banker Russell Laffitte hit with federal indictments for conspiracy, wire fraud, bank fraud

Alex Murdaugh: What we know, and don't know, about the Alex Murdaugh crime saga

During the bond hearing held in U.S. District Court in Charleston, Laffitte was granted a $500,000 secured bond and had to pay $25,000 upfront. Federal Magistrate Judge Molly Cherry also ordered him to undergo location "ankle" monitoring, forfeit his passport and guns, and not communicate about the case with witnesses, along with other standard conditions of federal bond, said Derek A. Shoemake, Assistant United States Attorney, District of South Carolina.

Laffitte is limited to house arrest and is also prohibited from talking about federal charges or any bank-related business with members of his family. The Laffitte family founded Palmetto State bank more than a century ago.

Laffitte paid the bond the same day, said the U.S. Attorney's Office. His attorney, Bart Daniel, did not return emails this week or last week seeking comment.

Assistant U.S. Attorney Emily Limehouse had requested only a $25,000 bond, but attorneys Eric Bland and Ronald Richter, who represent two of Laffitte and Murdaugh's alleged financial victims, argued for more. Laffitte allegedly committed "tremendously fraudulent conduct" and "breached the trust of these girls [his young clients]," said Bland.

"This is not a parking ticket case," Bland told the court. "You need to send a message.. He's not Alex Murdaugh, but he needs a reasonable bail."

Alex Murdaugh conspiracy:: Hampton County ex-banker gets $1 million bond and house arrest

On Friday, Bland told The Hampton County Guardian that he and his clients, who were in the courtroom, were "very pleased" with the outcoming of the hearing.

Bland Richter LLP represents Alania Spohn and Hannah Plyler, who are sisters. On July 16, 2005, the sisters lost their mother and brother and suffered significant personal injuries in a tragic rollover automobile accident while they were underaged children. Murdaugh handled their civil suit, and Laffitte was named a conservator in their case.

The federal indictment alleges that Laffitte conspired with Murdaugh, then a partner at a Hampton law firm, PMPED, to commit wire fraud and bank fraud while employed as CEO of Palmetto State Bank of Hampton. According to the charge, Laffitte and Murdaugh engaged in a scheme to defraud Murdaugh's personal injury clients and his law firm from funds held at Palmetto State Bank.

Specifically, the indictment alleges that Laffitte, while serving as conservator for two of Murdaugh's clients (Spohn and Plyer), extended $355,000 in personal loans to himself and $990,000 in personal loans to Murdaugh from client funds held at the Hampton bank. Much of these funds were used to cover overdrafts on Murdaugh's personal account.

The indictment also alleges that, at Murdaugh's direction, Laffitte transferred the clients' disbursed settlement funds into bank money orders, cash, and other wire transfers while collecting $391,781.07 in fees for serving as conservator and personal representative for those clients.

Also, according to the indictment, on two occasions, Laffitte misapplied bank funds: on Oct. 28, 2021, Laffitte paid the law firm $680,000 without notice to or consent from PSB, knowing that he had fraudulently transferred the money to the bank customer. Finally, the indictment alleges that on July 15, 2021, Laffitte misapplied $750,000 of bank funds by extending an unsecured commercial loan to Murdaugh.

If convicted, Laffitte faces a maximum term of imprisonment of 30 years on all federal charges, in addition to any penalties that arise from similar fraud and conspiracy charges levied against him by the state grand jury earlier this year.

The case was investigated by the Federal Bureau of Investigation, the South Carolina Law Enforcement Division, and the South Carolina Attorney General’s Office. Assistant U.S. Attorney Emily Limehouse is prosecuting this case.

Laffitte was indicted on related state grand jury charges in connection with Murdaugh. Before the federal bond hearing, he was granted a $1 million bond, house arrest, and similar restrictions on the state charges.

Laffitte was terminated from his position at PSB in January of 2022 after allegations of misconduct first arose.

Laffitte's federal indictments came on the same day that Murdaugh received a bond hearing in Colleton County on charges that he murdered his wife, Maggie, and younger son, Paul, on June 7, 2021. Bond was denied on those charges.

Murdaugh, who now faces a total of 88 criminal charges that range from financial crimes to drug charges and violent offenses, remains in the Richland County detention center on a prior $7 million bond for the financial allegations.

This article originally appeared on Greenville News: Russell Laffitte granted $500K bond on federal charges