CHARLESTON, S.C. (WCBD) – Day three of the federal trial against former Palmetto State Bank (PSB) CEO Russell Laffitte resumed Thursday in Downtown Charleston.
Laffitte is accused of facilitating the misappropriation of millions of dollars from clients Murdaugh represented.
Federal Prosecutors led by Assistant US District Attorney Emily Limehouse picked up their case calling two witnesses to the stand for hours of testimony.
Jan Walinowski, CEO of Palmetto State Bank replaced Laffitte after he was fired in early 2022, returned to the stand Thursday morning after being questioned late Wednesday afternoon.
Walinowski laid out general practices on how PSB typically handles settlement checks, disbursements, conservatorships, and personal representative cases.
Walinowski says large loans like those granted by Laffitte to himself and Murdaugh require majority approval from the bank’s board of directors, which Walinowski says Laffitte never obtained.
In the Spring of 2021, executives with the former Murdaugh Law Firm (PMPED), now known as Parker Law Group, began questioning where money from one of Murdaugh’s cases went. Murdaugh insisted it was being held in a trust account with Wilson Law Group and attorney Chris Wilson.
As revealed on Wednesday, PMPED’s CFO Jeanne Seckinger confronted Murdaugh in his office on June 7th, 2021, asking where the money went. Shortly into the conversation, Murdaugh received a call that his father was returning home from the hospital to hospice, effectively ending the conversation. Murdaugh’s wife and son were brutally murdered later that day.
Weeks would pass before PMPED law partner Ronnie Crosby asked Seckinger for her help to track down the funds. Both were assured by Murdaugh that the funds were being held by Wilson. Eventually, through emails, digging, and conversation, the pair found out Murdaugh had cashed checks for the attorney’s fees due to the law firm in March of 2021. After they found out, the law firm held a special meeting on September 2nd before confronting Murdaugh the next day and asking him to resign from the firm. The firm contacted the office of disciplinary counsel to report the crime.
Murdaugh attempted to execute a suicide-for-hire plot days later, hoping his only living son, Buster, could cash in on a $10M life insurance policy.
Executives from PMPED went to Palmetto State Bank the following week to alert them of Alex’s separation from the law firm, where Murdaugh was hundreds of thousands of dollars overdraft on his accounts and had millions of dollars in outstanding loans.
Both executives from the Palmetto State Bank and PMPED began searching through records and cases involving Murdaugh. PMPED began noticing irregularities in cases Murdaugh had handled, including a settlement case in the death of Donna Badger in which Russell Laffitte, CEO of Palmetto State Bank, served as conservator for.
Seckinger, PMPED’s CFO, asked Laffitte to send over all checks from the bank related to the Badger settlement. Shortly after identifying more than a million dollars had never been paid to the clients, Laffitte cut a check from Palmetto State Bank for $680,000 and hand-delivered it to the law firm. The check from PSB was cut without approval from the bank’s Board of Directors who learned about it after Laffitte had dropped it off.
Walinowski says other board members were furious to learn about what Laffitte did and met with legal counsel. They questioned Laffitte about converted checks and money tied to Murdaugh that had gone missing, but Laffitte denied any knowledge of what happened. Bank executives held an emergency meeting and voted to separate from Laffitte.
During testimony, Crosby says attorneys and executives at the law firm began to review other cases Murdaugh had worked on from October to December identified several cases in which Murdaugh had taken the money. Crosby says employees and attorneys were shocked to learn of the full extent of the crimes and believe Murdaugh, Palmetto State Bank, and Russell Laffitte should take responsibility.
Laffitte’s defense continues to push their client was a pawn in the scheme and was duped by Alex Murdaugh, like so many others. Federal prosecutors say Laffitte was a capable participant in the schemes to divert money.
Testimony in the trial is set to resume on Monday morning in Downtown Charleston with Federal Prosecutors calling more witnesses.