How Alex Murdaugh Opened The Door For Convictions On Financial And Tax Crime Charges

Taxes

On June 7, 2021, Alex Murdaugh called police from his cell phone to report that he had discovered the bodies of his wife, Margaret “Maggie” Murdaugh, and son, Paul Murdaugh on the family’s 1,800-acre property. Last week, Murdaugh took the witness stand for two days to deny he was the one to pull the trigger. The jurors will ultimately decide whether his high-risk and unusual decision to testify in his own defense will help Murdaugh win acquittal on two counts of murder and two counts of possession of a weapon during the commission of a violent crime.

But this much is clear: his testimony, including his admissions that he stole money, is likely to hurt him in any future trials on 99 other state counts pending against him for financial crimes, including embezzlement, money laundering and evading taxes —on nearly $7 million that he allegedly stole. It is “hard to put the rabbit back in the hat,’’ says Brian L. Tannebaum, who focuses on ethics and criminal defense matters as a Special Counsel for Bast Amron, a boutique law firm in Florida.

Each of those financial charges carries a potential sentence of up to five years, meaning the 54-year-old Murdaugh could in theory spend the rest of his life in prison for those crimes, even if he’s acquitted of murder. (For now, he’s being held in jail on the murder charges.)

The murder trial, now in its sixth week, has garnered national attention—and not just because of the horrific slayings of two members of one of the most prominent families in South Carolina. The murders capped a slew of bizarre tales involving the Murdaugh family, including significant financial issues which were made public. Those alleged financial crimes—and what Murdaugh might choose to reveal about them—have kept viewers glued to their seats as the trial aired on cable television and streaming services like YouTube.


Murdaugh Country

To understand Murdaugh’s fall from grace—and the impact of his admissions—you have to know how he arrived at the top in the first place. Alex Murdaugh comes from lawyer royalty in the Low Country of South Carolina. The Low Country is culturally distinct from many other regions in the South, and even locals argue about where it begins and ends. Some say you know you’re there when you can smell it—the scents of saltwater and marsh hang in the air, punctuated by the lively notes of Gullah cuisine and pit-cooked barbeque, giving it a sense of place that you can’t find anywhere else. Most, however, agree that it generally includes Beaufort, Colleton, Hampton, and Jasper Counties.

It was in Hampton, SC—the center of Hampton County—where, in 1910, Randolph Murdaugh Sr. opened a law firm that would become the beginning of a dynasty. From 1920 to 2006, the Murdaughs ruled the legal scene, serving as district attorney for South Carolina’s 14th circuit district. Locals called the area “Murdaugh Country.”

Alex Murdaugh followed in his ancestor’s footsteps, attending law school and taking his position in the family law firm. That firm, which focused on personal injury litigation, got a boon in the early 2000s from a state law that allows plaintiffs to engage in forum shopping—the practice of filing suit in a jurisdiction that will treat the claim more favorably. In South Carolina, residents can file a lawsuit in any county where an out-of-state company owns property and conducts business no matter where a potential wrong occurred.

That made it easy to sue in Murdaugh country—and the money came rolling in. Prosecutors allege that Murdaugh made nearly $14 million as a lawyer over nine years.

But money tends to complicate things—and that’s what all parties allege happened in the Low Country.

Alex married Margaret in 1999, and the couple had two sons, Richard “Buster” Alexander Murdaugh Jr. and Paul Terry Murdaugh. They appeared to have a picture-perfect life.


Legal Issues

But folks talk in a small town. On Feb. 24, 2019, Paul was at the wheel of the boat when a local teenager, Mallory Beach, was killed. Despite being underage—and legally over the blood alcohol limit—Paul wasn’t handcuffed or taken to jail. Locals whispered that it was the benefit of being a Murdaugh.

The Beach family, however, refused to let the Murdaughs escape the public eye. A month later, they filed a wrongful death lawsuit against the Murdaughs. The result was an inquiry into the Murdaughs’ financial affairs that would set off a chain of events that prosecutors would allege resulted in murder.

Alex had struggled with an addiction to opioids for the last 20 years and was spending $50,000 per week to support his habit. Despite making millions, he allegedly stole millions from his law firm to support his habit.

On the day that Maggie and Paul were found dead, Alex was approached by members of his law firm who had found out about the alleged thefts. He had a court date three days later regarding those financial irregularities. That, prosecutors allege, combined with being confronted by his family over his drug abuse, were the factors that led Murdaugh to commit murder.

Three months after the murders, Alex resigned from his law firm. The next day, on Sept. 4, 2021, Alex was shot in the head while changing a tire. He initially claimed he had been targeted—but eventually confessed that he was the one who made himself the target. He had asked a former client, Curtis Edward Smith, to kill him so his remaining son, Buster, could collect a $10 million insurance payment. The plot failed, as he survived.

As a result of his actions, Alex Murdaugh is now facing more than 100 criminal charges and has been named as a defendant in three separate lawsuits (one of those, the Beach lawsuit, settled in January of 2023). In July 2022, he was disbarred from the practice of law.

In the same month, Alex Murdaugh was indicted on two counts of murder and two counts of possession of a weapon during the commission of a violent crime in the deaths of Maggie and Paul.


Murder Trial

The murder trial kicked off on Jan. 23, 2023, in Walterboro, South Carolina. Just before the trial, the judge ordered the removal of a portrait of Alex Murdaugh’s grandfather from the wall in the courtroom.

From the start, the prosecution’s case focused on Alex Murdaugh’s house of cards—his desperate financial situation, his drug addiction, and his lies. He was still staring at 99 additional charges for embezzlement, money laundering, computer crimes, forgeries, and other financial crimes. Nine of those charges included tax evasion—among other things, the state is seeking the taxes due on the nearly $7 million that he allegedly stole and failed to pay taxes on over the period 2011 to 2019. He faces up to five years in prison on each count if convicted.

The defense argued that the prosecution shouldn’t be allowed to raise questions about Murdaugh’s financial crimes at the murder trial. After a hearing, Judge Newman ruled the testimony related to Murdaugh’s alleged financial crimes was admissible.

On Feb. 23, Alex Murdaugh took the stand against the advice of his counsel. Before he was sworn in, his counsel again raised the issue of the scope of testimony—they wanted the judge to disallow questions related to his financial crimes. The judge again refused the request.

The decision to testify on his behalf raised eyebrows across the country. Isn’t it preferable not to take the stand in your own defense—especially when you may be asked to testify about other crimes you might have committed?

Tannebaum, the Florida lawyer who specializes in ethics and criminal defense, agrees that it’s a gamble. He says there can be situations where a defendant wants to get on the stand. In Kyle Rittenhouse’s case, for example, video footage proved that Rittenhouse pulled the trigger, making the question for the jury not, “Did he shoot?” but rather, “Was he justified?” Rittenhouse’s personal testimony may have helped him win an acquittal.

In the Murdaugh trial, there is no video. There is, outside of cell phone and other evidence placing Alex Murdaugh at the scene, very little evidence other than his own story. That, says Tannebaum, probably drove Murdaugh, who was experienced with juries, to want to testify, “I didn’t do this.”


Murderer Or Liar?

It can be, Tannebaum notes, a dangerous road to go down—for both sides. The defense has to worry that he will turn out to be a terrible witness and that his multiple statements could be used against him. But the prosecutors have a concern, too. It’s their burden to prove that Murdaugh committed murder—not simply that he’s a liar. A good defense attorney, he says, will remind the jurors that the instructions don’t have a box to tick for lying or bad character—the charge is murder. That’s important because, in his 27 years of legal experience, Tannebaum has found that juries take their jobs very seriously. And in this case, the jury has to be sure not that he was a liar or a drug addict but that Murdaugh killed his wife and son, to commit to a guilty verdict.

As the trial went on, it was clear that the prosecution wanted to paint Murdaugh as someone who could not be trusted. That means that the issues of his character, including the allegations of theft and lying, were raised repeatedly.

The judge had previously ruled that he would not limit the scope of the testimony, including from Murdaugh. That makes sense, according to Tannebaum. Cross-examination of a witness always follows direct testimony—and what is asked during cross-examination is based on direct testimony. Since the judge doesn’t know ahead of time what that questioning or testimony will entail, picking and choosing what to limit in advance isn’t always appropriate.

Plus, Tannebaum adds, it may be that testimony necessarily opens the door for further questions. The judge could have ruled that testimony about an extramarital affair was merely prejudicial—but if the defense then asked Murdaugh to talk about how much he loved his wife, he may have “opened the door” for additional questioning.

That doesn’t mean there can’t be an agreement in advance to limit questions or the scope of testimony. It can be common in depositions. And at trial, the judge could find that the line of discussion would be more prejudicial to the jury than probative, which means that it should not be admitted.

Before Alex Murdaugh stepped to the stand, Judge Newman advised him of his constitutional rights not to testify under the Fifth Amendment. He chose to testify anyway and admitted to lying and committing some financial crimes. It appears that he did so because he wanted to clear up what he has suggested were statements made after the crime when he was confused. He talked a great deal, and prosecutors hope to use that information against him. That’s why Tannebaum advises those who may be charged with a crime, “Never speak to the police.”

It may sound drastic, but Tannebaum says it’s easy to make statements that are later deemed inconsistent—or folks simply volunteer too much information. Memory, he says, can be imperfect. People may get nervous and start talking too much. They can, as Murdaugh claims he has done, say things about where they were or what they were doing that they later claim they said in a moment of panic.

And, Tannebaum says, sometimes, the wrong decisions get made, and innocent people do get convicted.


Future Trials

How could this impact Murdaugh’s future trials? Plenty. Alex has testified under oath. He is well aware that anything he says can and will be used against him—in upcoming civil and criminal trials. That includes confessions that he stole money—which could be harmful in his financial crimes trials, including those for tax evasion.

MORE FROM FORBES

Articles You May Like

Nvidia’s earnings cleared our lofty bar. Here’s our new price target on the AI chip king
How the world’s 431 women billionaires make, spend and give away their fortunes
Disney is turning record parks profits — even before its big expansions
Medicare Premiums For 2025 Rise 5.9%, Other Out-Of-Pocket Costs Increase
Older voters prioritized personal economic issues, helped Republicans win on Election Day, new AARP poll finds

Leave a Reply

Your email address will not be published. Required fields are marked *