Murdaugh Indicted for Skimming Insurance Funds; Accomplice Attorney Pleads

Former South Carolina injury attorney Alex Murdaugh, convicted in March of murdering his wife and son, has been indicted on 22 federal counts of defrauding clients, laundering money, and diverting insurance proceeds into his personal account.

Murdaugh set up a fake bank account in the name of a corporation that he presented as a structured insurance settlement program. He funneled personal injury settlements through the account but used the money for personal gain, the indictment and the U.S. Attorney’s office said Wednesday.

Also, he conspired with another attorney to defraud his housekeeper’s family out of life insurance proceeds after her suspicious death in a fall at Murdaugh’s home in 2018. Murdaugh recommended that the housekeeper’s estate hire the attorney, Cory 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 Fleming then conspired to siphon the funds, disguised as “prosecution expenses,” for their own personal enrichment.

Fleming, a longtime friend and Murdaugh’s college roommate, pleaded guilty this week to fraud charges in connection with the scheme, according to prosecutors and court records. Fleming now faces a maximum penalty of up to five years in prison and a fine of up to $250,000, the U.S. Attorney said.

In another part of the scheme, the grand jury found that from 2011 to 2021, Murdaugh conspired with his banker, Russell Laffitte, to commit wire fraud and bank fraud. Murdaugh and his law firm asked Laffitte to serve as conservator for a number of clients, and Laffitte collected more than $350,000 in fees.

As part of the scheme, the law firm made settlement checks payable to “Palmetto State Bank.” The checks were then delivered to Laffitte, who then paid off Murdaugh’s personal loans and used the money for Murdaugh’s personal expenses and cash withdrawals.

Laffitte was convicted in November of fraud and conspiracy to commit wire and bank fraud, for his role in this scheme. He is currently awaiting sentencing.

Photo: Murdaugh, center, and his attorneys at sentencing in March. (AP)