|Nicky Scarfo Jr.|
Luchese mobster Nicodemo S. Scarfo and associate Salvatore Pelullo were convicted today of looting more than $12 million in less than a year from a mortgage company, and used the money to buy homes, weapons, ammunition, a plane, luxury cars, jewelry and an $850,000 yacht they named "Priceless."
Both men, because of prior criminal convictions and their roles in the racket, face 30 years to life. Judge Kugler is slated to sentence the two in October.
Specifically, Scarfo, the son of former Philadelphia mob boss Nicodemo D. Scarfo, was convicted of multiple counts of racketeering conspiracy, conspiracy to commit securities fraud, wire fraud and being a felon in possession of a gun.
Pelullo, who prosecutors said ran the business takeover, was convicted of racketeering conspiracy, conspiracy to commit securities fraud and related counts.
Scarfo and his co-defendants used threats of harm to take over the board of publicly held FirstPlus Financial Group, a Texas-based mortgage company. Then they had the company buy shell companies the co-defendants owned so they could steal the assets, prosecutors contended. FirstPlus is now defunct.
The government said the men conspired in 2007 to get the money from FirstPlus by hiring shell companies owned by Pelullo and Scarfo as consultants, then by using FirstPlus to buy those and other shell companies the two formed.
Brothers John and William Maxwell, both executives at FirstPlus, were found guilty Thursday of wire fraud. The judge revoked their bail, saying they faced more than 20 years.
Scarfo and Pelullo have been held without bail since December of 2011.
During the trial, prosecutors played for jurors recordings that they said established that the business dealings were mob-related, including some jailhouse recordings of conversations involving the elder Scarfo in which his son and Pelullo talk about the company takeover.
In 1989, the younger Scarfo was the victim of what authorities have described as an attempted mob hit in a South Philadelphia Italian restaurant. He was shot a half-dozen times. His father, sharing a prison cell with Luchese boss Vittorio "Vic" Amuso, made an arrangement whereby his son was inducted in the Luchese family.