Wire fraud, bank fraud, money laundering: Feds indict Alex Murdaugh on 22 charges

CHARLESTON, S.C. (WMBF) - Disbarred Lowcountry attorney and convicted murderer Alex Murdaugh is facing nearly two dozen new charges.

The U.S. Department of Justice said a federal grand jury indicted Murdaugh on charges that include conspiracy to commit wire fraud and bank fraud, bank fraud, wire fraud and money laundering.

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“Trust in our legal system begins with trust in its lawyers,” said U.S. Attorney Adair F. Boroughs. “South Carolinians turn to lawyers when they are at their most vulnerable, and in our state, those who abuse the public’s trust and enrich themselves by fraud, theft, and self-dealing will be prosecuted to the fullest extent of the law.”

The indictment alleges that Murdaugh engaged in three different schemes to obtain money and property from his personal injury clients.

FIRST SCHEME

In the first scheme, the indictment alleges that from at least September 2005 until at least September 2021, Murdaugh devised a scheme to defraud and obtain money by means of false pretenses.

The indictment alleges that Murdaugh routed and redirected clients’ settlement funds to personally enrich himself, including by:

• Drafting, or directing law firm employees to draft, disbursement sheets to send settlement funds to Murdaugh’s accounts without proper disclosure or client or law firm approval;
• Claiming funds held in the law firm’s trust account as attorney’s fees and directing the disbursement of those funds for his benefit;
• Claiming and collecting attorney’s fees on fake or nonexistent annuities;
• Creating fraudulent “expenses” that were never incurred on client matters and directing the disbursement of settlement funds to pay the cited costs, including claimed medical expenses, construction expenses, and airline expenses;
• Directing other attorneys with whom he was associated on client matters to disburse attorney’s fees directly to him, rather than appropriately routing the fees through the law firm; and
• Intercepting insurance proceeds intended for beneficiaries and depositing them directly into his personal account.

SECOND SCHEME

In a second scheme, the indictment alleges that from in or around July 2011 until at least October 2021, Murdaugh conspired with his banker, Russell Laffitte, to commit wire fraud and bank fraud.

The indictment alleges that Murdaugh and his law firm asked Laffitte to serve as the personal representative or conservator for numerous personal injury clients. Laffitte collected over $350,000 in fees as the personal representative or conservator for Murdaugh’s personal injury clients.

The indictment also alleges that Murdaugh directed law firm employees to make settlement checks payable to “Palmetto State Bank” as part of the scheme. The checks were then delivered to Laffitte, whom Murdaugh directed to use the settlement funds for his own benefit. Those funds were used to pay off Murdaugh’s personal loans, personal expenses, and cash withdrawals.

In November 2022, Laffitte was convicted on six federal charges, including conspiracy to commit wire and bank fraud, bank fraud, and wire fraud for his role in this scheme. He is currently awaiting sentencing.

THIRD SCHEME

In a third scheme, the indictment alleges in September 2015, Murdaugh created a bank account in the name of “Forge,” presenting as a legitimate corporation for structuring insurance settlements. He was the owner of and the only authorized signer on this account.

The indictment alleges that from in or around May 2017 through at least July 2021, Murdaugh funneled stolen personal injury settlements through the “fake Forge” account.

Murdaugh is charged with 14 counts of money laundering for using the transactions in the “fake Forge” account to conceal the proceeds of his fraud.

The indictment further alleges that, from in or around February 2018 until at least October 2020, Murdaugh conspired with a personal injury attorney in Beaufort, Cory H. Fleming, to defraud the estate of Murdaugh’s former housekeeper, Gloria Satterfield, and Murdaugh’s homeowner’s insurance carriers.

In February 2018, Murdaugh’s housekeeper passed away after a fall at Murdaugh’s home. He recommended Satterfield’s estate hire Fleming to represent them and file a claim against Murdaugh to collect from his homeowner’s insurance policies.

Murdaugh’s insurance companies settled the estate’s claim for $505,000 and $3,800,000. The indictment alleges that Murdaugh and the personal injury attorney conspired to siphon settlement funds, disguised as “prosecution expenses,” for their own personal enrichment. The indictment further alleges that Murdaugh directed Fleming to draft checks totaling $3,483,431.95 made payable to “Forge.” Murdaugh then deposited the checks into his “fake Forge” account and used the funds for his own personal enrichment. The housekeeper’s estate did not receive any of the settlement funds.

Murdaugh faces the following charges:

• One count of conspiracy to commit wire fraud and bank fraud, punishable by up to 30 years in prison and a fine of up to $1,000,000;
• One count of bank fraud, punishable by up to 30 years in prison and a fine of up to $1,000,000;
• Two counts of wire fraud, punishable by up to 30 years in prison and a fine of up to $1,000,000;
• Three counts of wire fraud, punishable by up to 20 years in prison and a fine of up to $250,000;
• One count of conspiracy to commit wire fraud, punishable by up to 20 years in prison and a fine of up to $1,000,000; and
• Fourteen counts of money laundering, punishable by up to 20 years in prison and a fine of up to $500,000.

The case was investigated by the Federal Bureau of Investigation and the South Carolina Law Enforcement Division.

CO-CONSPIRATOR TO PLEAD GUILTY

Fleming is scheduled to plead guilty in federal court on Thursday to conspiracy to commit wire fraud, according to the U.S. Department of Justice.

Fleming is scheduled to plead guilty to an indictment alleging that from in or around March 2018 until at least October 2020, Fleming conspired with Murdaugh to defraud the estate of Murdaugh’s former housekeeper and to obtain money and property from the estate by means of materially false and fraudulent pretenses.

Fleming faces a maximum penalty of up to five years in prison and a fine of up to $250,000.

“We are grateful to the FBI for their tireless work on this case and to the South Carolina Attorney General’s Office and the South Carolina Law Enforcement Division for their work to hold Alex Murdaugh, and those who enabled him, accountable in our state system,” said Boroughs. “We remain committed to doing our part to further that effort in the federal system.”

Murdaugh’s attorneys, Dick Harpootlian and Jim Griffin released the following statement regarding the federal charges:

“Alex has been cooperating with the United States Attorneys’ Office and federal agencies in their investigation of a broad range of activities. We anticipate that the charges brought today will be quickly resolved without a trial. "

Assistant U.S. Attorneys Emily Limehouse, Kathleen Stoughton, and Winston Holliday are prosecuting the case.

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