wow this is going into the 4 month of trial wat a snooz fest. all this mob talk and the case has nothing to do with the lcn except 1 made guy who never threaten anyone or beat anyone bet this case has a screwed up outcome. its in Camden federal court aint that like the poorest place around bet the judge hasn't seen a case that didn't involve crack murder dope slanging in yrs. probably goes easy on scarfo.

Here's the Latest:

Friday, April 18, 2014
Prosecutors and defense lawyers invoke the mafia during Scarfo trial


The meeting at a North Jersey bar was convened to set things straight. Contrary to rumors bouncing around the Philadelphia-New Jersey mob world, Pete "the Crumb" Caprio did not have a hit out on Nicodemo S. Scarfo, son of the jailed, infamous mob boss.

"If it was so, I said you would have been gone a long time ago," said Caprio to an associate in a secretly taped conversation of the meeting.

The February 2000 recording - by mob associate and government informant Philip "Philly Fay" Casale - was played for jurors and dissected by lawyers Thursday in Scarfo's FirstPlus mortgage fraud trial, well into its fourth month.

In the case, before U.S. District Judge Robert Kugler in Camden, Scarfo and an associate, Salvatore Pelullo, along with lawyers and corporate partners, are charged with taking over the Texas-based FirstPlus Financial mortgage company and looting its shareholders of $12 million.

On Thursday, as a prosecution expert on the mob testified, both the prosecution and the defense invoked organized crime allegations to support their positions, and a revelation emerged about the notorious Halloween attempt on Scarfo's life 20 years ago.

The defendants are charged with racketeering, extortion, fraud, money laundering, and obstruction. Scarfo and Pelullo also face RICO charges, accused of having alleged mob ties and of extortion.

The government says the FirstPlus shakedown was a mob enterprise led by Scarfo, who it says is a made member of the Lucchese crime family.

His lawyer, Michael Riley, says the government is invoking Scarfo's incarcerated mobster father, Nicodemo "Little Nicky" Scarfo, to portray the son as more involved in organized crime than he was and to make a bad business deal seem illegal.

Riley said Thursday that his client's family has been maligned for years because of the Scarfo name. One of his brothers changed his name and another tried to commit suicide.

On Thursday, jurors who had grown accustomed to hearing testimony about SEC filings and bank documents listened to FBI Special Agent Kenneth Terracciano give them a primer on mob structure and rules, and explain Scarfo's relationship to a cast of characters with nicknames such as "Joey Electric" and "Beeps."

Terracciano, with crew-cut white hair and a slight North Jersey accent, said he had worked on organized crime for about 10 of his 19 years with the FBI.

Scarfo's father ran the Philadelphia mob from 1982 until he was convicted of racketeering and eight counts of murder in 1988. Trouble came to the younger Scarfo, Terracciano said, on Halloween 1989, when a masked gunman interrupted him at dinner at Dante's & Luigi's in South Philadelphia and shot him eight times, nearly killing him.

The case has gone unsolved, but on the stand, Terracciano told jurors he believed the gunman was Joey Merlino, son of Salvatore "Chuckie" Merlino and the alleged current mob boss of Philadelphia.

Terracciano said Salvatore Merlino "had a beef" with the older Scarfo at the time, stemming from an internal struggle over control of the family.

Speculation has surrounded Joey Merlino - who denies involvement and has never been charged - but no one in authority had publicly pointed the finger at him until Thursday, Riley noted.

"You told this jury and everyone else that wants to listen for the first time since 1989 that Mr. Merlino shot Mr. Scarfo?" Riley pressed Terracciano.

"He gave his opinion, he said what he said," Kugler interjected.

Following the attempt on his life, Scarfo moved to North Jersey, where his father had set him up with the Newark crew of the Lucchese family for protection, Terracciano said. "He remained in Northern Jersey and ultimately became a member," he said.

Less than 10 years later, FBI agents warned Scarfo about threats to his life, this time from Peter Caprio, whom Terracciano described as a known killer and fellow member of the family.

On Feb. 18, 2000, Caprio and Casale, who was wearing a wire, met at a diner before heading to the bar to see Scarfo. In the recording of their conversation, Caprio and Casale, along with others, are heard discussing how little they know about Scarfo, inquiring about his body type, age, line of work, and whether anyone had seen him since he was shot.

Riley highlighted the dialogue to distance Scarfo from the mobsters.

"These guys, who worked with the father for many years and knew the father when he was running the streets for the family, don't have any idea who [the younger Scarfo] is, what he looks like, what he does or how old he is," Riley said.

With the jury sent out of the room, Assistant U.S. Attorney Steven D'Aguanno argued that one reason the younger Scarfo was not on the mobsters' radar could have been that he was in and out of prison in the 1990s on racketeering charges - something he said should be presented to the jury. He said Riley had opened up that time frame in question.

The six other defense lawyers, otherwise mostly silent, objected one by one, starting with Barry Gross, lawyer for David Adler, a New York-based lawyer who is among the accused. Gross said allowing such testimony could taint the six defendants with no organized crime ties.

Ultimately the judge did not permit the testimony to be presented to the jurors.

Prison telephone records of conversations between the elder Scarfo and his son, played to the jury earlier in the trial, appeared to provide a stronger mob connection in the case:

"Honest to God, we're a good six to 10 months off from being able to help everybody," Scarfo tells his father, allegedly referring to crime associates, in a phone conversation from 2007.

In another jail conversation in 2007, following the dismantling of the former FirstPlus board of directors, Pelullo tells Scarfo's father, "We crushed them. . . . It was all upon your direction. . . . The only people that can [obscenity] it up now is us."

http://www.fivefamiliesnyc.com/2014_04_01_archive.html

Lucchese associate asks for mistrial after being ejected from courtroom
A reputed Lucchese crime syndicate associate on Monday sought a mistrial in his prosecution for allegedly draining $12 million from a mortgage lender and forcing its bankruptcy, claiming a New Jersey federal judge infringed his rights and tainted the jury by ejecting him from court.

Salvatore Pelullo filed a motion on Monday asking the court to declare a mistrial in the prosecution of his alleged role in the extortionate takeover of FirstPlus Financial Group, a Texas mortgage lender. Pelullo has been unable to attend his own trial for a month, following an order from U.S. District Court Judge Robert B. Kugler barring Pelullo from the courtroom after he made several outbursts that may have been audible to the jury.

Pelullo said in his filing that by expelling him from the courtroom, Kugler violated his Fifth Amendment right to due process and Sixth Amendment right to be assisted by an attorney and tried by an impartial jury. The judge’s decision was unwarranted, according to the brief, because Pelullo’s “outbursts” were merely his attempts to confer with counsel and were not significantly disruptive to the proceedings.

“Although it is undisputed that Mr. Pelullo made a comment concerning government witness Ken Stein's veracity, it is equally undisputed that he made this comment in the course of conferring with counsel during the course of trial, a right guaranteed by the Sixth Amendment,” the brief said.

“In response to Ken Stein's testimony regarding the receipt of certain information, Mr. Pelullo informed his counsel that Mr. Stein was lying, which was information that counsel could only learn from Mr. Pelullo. In short, Mr. Pelullo was assisting his counsel in the precise manner that a defendant is supposed to do during the course of a trial.”

Pelullo also pushed back against federal prosecutors’ claim that his comments were audible to the jury. According to the brief, Pelullo’s remarks were not audible to Kugler or the court reporter, and are inaudible on an audio recording of the proceedings.

The brief also said jurors have seen Pelullo in his prison clothes, prejudicing them against him and precluding a fair, impartial trial.

Oral argument has been requested, but is not yet scheduled, according to court filings.

Kugler banished Pelullo from the courtroom last month after Pelullo said, “That’s a lie,” as Stein, a government witness, testified. According to court filings, Assistant U.S. Attorney Steven D’Aguanno alerted the court that he heard the comment and said he saw a juror look in Pelullo’s direction after the comment was made. Three U.S. Marshals later reported to the court having heard the same comment.

Pelullo had already been warned about his outbursts following another incident in late February, in which Pelullo laughed loudly while another witness testified. Kugler warned Pelullo that he would be booted from the courtroom if there were further incidents.

J. Michael Farrell and Troy A. Archie, Pelullo’s attorneys, quickly filed a motion asking Kugler to allow their client back in to the courtroom, arguing that removing Pelullo from court for the remainder of his trial violates his constitutional rights, and effectively punishes him for suffering from bipolar disorder, which is to blame for Pelullo’s outbursts. The attorneys also assured the court that Pelullo would curtail his behavior going forward, but Kugler denied the motion.

Pelullo’s attorneys did not immediately respond to requests for comment on Wednesday.

According to an October 2011 indictment, Pelullo worked with fellow reputed Lucchese family member Nicodemo Scarfo to seize control of Beaumont, Texas-based FirstPlus by intimidating its board of directors into approving new board members handpicked by and under the influence of Pelullo and Scarfo. Following the takeover, the board approved multimillion-dollar acquisitions of companies owned by Pelullo and Scarfo that were grossly overvalued and essentially worthless, authorities said.

FirstPlus investors meanwhile were in the dark about the company's financial situation, thanks to false and misleading U.S. Securities and Exchange Commission filings, prosecutors said. They had little indication anything was wrong until the company's announcement in June 2009 that it had initiated Chapter 11 proceedings in the Northern District of Texas.

Pelullo faces 25 charges, including racketeering conspiracy, securities fraud, wire fraud, mail fraud, bank fraud, extortion, interstate travel in aid of racketeering, money laundering and obstruction of justice.

Kugler denied a motion to dismiss the case late last month, ruling Pelullo and Scarfo failed to prove prosecutors withheld evidence that might have proved their innocence and violated the scope of warrants when they seized various electronic records during a May 2008 raid.

Pelullo is represented by J. Michael Farrell and Troy A. Archie.

The case is U.S. v. Scarfo et al., case number 1:11-cr-00740, in the U.S. District Court for the District of New Jersey.

http://www.law360.com/articles/528851/lucchese-associate-asks-for-mistrial-due-to-court-ejection

I wonder what Phil Leonetti is thinking of all of this. Being that his cousin never listened to him about getting out of the life.

first time I can ever think of a big trial with so called mob guys were the guy life is on the line from another room. sal must have made some points with the jury in the d.a.s eyes that they asked for him to be gone from the room I starting to think its gonna be a crazy tommy shots trial outcome. maybe scarfo walks ain't Camden like the blackest place in nj. maybe the jury isn't so favorable to the prosecutor s.

read gangland today some pretty cool pics of vic amuso and scarfo together. guess them to are real close. vic amuso rites to nicky jr nowonder all the luchese hate him. vic and scarfo don't look like they aged from 30yrs ago what a crazy couple.

wonder how he got the pics. theres a pic of scarfo with taccetta who he writes to his son him and his brother are rats and sends him 39 pages of paper work. if the paper work is true them guys are gonna be shelved. but some bogus paperwork got capo al Bruno whacked, the gov said they made a mistake. scarfos the man guys more costa nostra then sonny fran.

So True. Sonny Franz didn't appear to have a problem with someone taking his kid out. I think Scarfo would do the work on his own kid. LOL.

From Ed Scarpo's blog today-

Scarfo FirstPlus Co-Defendant Sought Mistrial, Was Denied

The most recent news available for the FirstPlus Financial bust-out, according to court records, is that U.S. District Judge Robert B. Kugler declined to dismiss a host of charges -- including racketeering conspiracy, securities fraud, wire fraud, mail fraud, bank fraud, extortion and money laundering -- against Nicodemo Scarfo and Salvatore Pelullo.

On April 22, Pelullo filed a motion asking the court to declare a mistrial in the prosecution of his alleged role in the extortionate takeover of FirstPlus Financial Group, a Texas mortgage lender. Pelullo has been unable to attend his own trial for a month, following an order from U.S. District Court Judge Robert B. Kugler barring Pelullo from the courtroom after he made several outbursts that may have been audible to the jury.

Pelullo said in his filing that by expelling him from the courtroom, Kugler violated his Fifth Amendment right to due process and Sixth Amendment right to be assisted by an attorney and tried by an impartial jury. The judge’s decision was unwarranted, according to the brief, because Pelullo’s “outbursts” were merely his attempts to confer with counsel and were not significantly disruptive to the proceedings.

“Although it is undisputed that Mr. Pelullo made a comment concerning government witness Ken Stein's veracity, it is equally undisputed that he made this comment in the course of conferring with counsel during the course of trial, a right guaranteed by the Sixth Amendment,” the brief said.

“In response to Ken Stein's testimony regarding the receipt of certain information, Mr. Pelullo informed his counsel that Mr. Stein was lying, which was information that counsel could only learn from Mr. Pelullo. In short, Mr. Pelullo was assisting his counsel in the precise manner that a defendant is supposed to do during the course of a trial.”

Pelullo also pushed back against federal prosecutors’ claim that his comments were audible to the jury. According to the brief, Pelullo’s remarks were not audible to Kugler or the court reporter, and are inaudible on an audio recording of the proceedings.

The brief also said jurors have seen Pelullo in his prison clothes, prejudicing them against him and precluding a fair, impartial trial.

Oral argument has been requested, but is not yet scheduled, according to court filings.

Kugler banished Pelullo from the courtroom last month after Pelullo said, “That’s a lie,” as Stein, a government witness, testified. According to court filings, Assistant U.S. Attorney Steven D’Aguanno alerted the court that he heard the comment and said he saw a juror look in Pelullo’s direction after the comment was made. Three U.S. Marshals later reported to the court having heard the same comment.

Pelullo had already been warned about his outbursts following another incident in late February, in which Pelullo laughed loudly while another witness testified. Kugler warned Pelullo that he would be booted from the courtroom if there were further incidents.

J. Michael Farrell and Troy A. Archie, Pelullo’s attorneys, quickly filed a motion asking Kugler to allow their client back in to the courtroom, arguing that removing Pelullo from court for the remainder of his trial violates his constitutional rights, and effectively punishes him for suffering from bipolar disorder, which is to blame for Pelullo’s outbursts. The attorneys also assured the court that Pelullo would curtail his behavior going forward, but Kugler denied the motion.

Pelullo’s attorneys did not immediately respond to requests for comment on Wednesday.

According to an October 2011 indictment, Pelullo worked with fellow reputed Lucchese family member Nicodemo Scarfo to seize control of Beaumont, Texas-based FirstPlus by intimidating its board of directors into approving new board members handpicked by and under the influence of Pelullo and Scarfo. Following the takeover, the board approved multimillion-dollar acquisitions of companies owned by Pelullo and Scarfo that were grossly overvalued and essentially worthless, authorities said.

FirstPlus investors meanwhile were in the dark about the company's financial situation, thanks to false and misleading U.S. Securities and Exchange Commission filings, prosecutors said. They had little indication anything was wrong until the company's announcement in June 2009 that it had initiated Chapter 11 proceedings in the Northern District of Texas.

Pelullo faces 25 charges, including racketeering conspiracy, securities fraud, wire fraud, mail fraud, bank fraud, extortion, interstate travel in aid of racketeering, money laundering and obstruction of justice.

Kugler denied a motion to dismiss the case late last month, ruling Pelullo and Scarfo failed to prove prosecutors withheld evidence that might have proved their innocence and violated the scope of warrants when they seized various electronic records during a May 2008 raid.

Pelullo is represented by J. Michael Farrell and Troy A. Archie.

The case is U.S. v. Scarfo et al., case number 1:11-cr-00740, in the U.S. District Court for the District of New Jersey.

well we know by at least 2007(operation heat bust) scarfo jr. had been bumped down to soldier and replaced by ralph perna, and that was well before Crea had officially taken over the reigns from Amuso. that just goes to show the wanning influence Amuso had on the street years before he actually stepped aside.

TUESDAY, JUNE 3, 2014

Closing Arguments Due In FirstPlus Fraud Trial
By George Anastasia
For Bigtrial.net

Closing arguments are expected to begin tomorrow morning in the multi-million dollar fraud trial of mobster Nicodemo S. Scarfo, his business partner Salvatore Pelullo and five co-defendants.

Assistant U.S. Attorney Steven D'Aguanno is scheduled to address the jury after Judge Robert Kugler completes a lengthy explanation of the laws that apply in the case. Kugler began his jury charge today and spoke for about three hours. He will likely spend another hour before turning the case over to the prosecution for its final arguments.

The complicated case revolves around allegations that Scarfo, 48, and Pelullo, 46, secretly took control of FirstPlus Financial, a troubled Texas mortgage company, in 2007 and then systematically siphoned nearly $12 million from the firm throughout phony business deals and bogus consulting contracts.

The sixteen member jury panel (four are alternates) have heard nearly five months of testimony and have seen thousands of pieces of evidence that the prosecution says lays out the fraud in exacting detail. But the defense, in an argument that is expected to be repeated again and again during closings, has said that the government has overstated and sensationalized the evidence and that the failure of FirstPlus was a result of a poor economy, not fraud and criminality.

Scarfo's mob connections, he is the son of jailed Philadelphia mob boss Nicodemo D. "Little Nicky" Scarfo, added yet another twist to the story. The defense claims the spectre of organized crime was thrown into the case -- among the witnesses was a former FBI organized crime specialist -- in order to hype an otherwise drab business story built around tedious financial statements and laborious SEC filings.

But the prosecution has alleged -- and has used wiretapped conversations to support its contention -- that Pelullo and Scarfo used threats and intimidation to wrest control of FirstPlus in the summer of 2007. Pelullo, who was a behind-the-scenes consultant to FirstPlus, orchestrated the takeover, according to the government, and resorted to verbal threats to advance the scheme which included sitting a new board of directors in October 2007 that answered directly to Pelullo and Scarfo.

Pelullo has been described as a mob associate and a mob wannabe. He has two prior fraud convictions.

Scarfo, who has convictions for racketeering and gambling, was identified as a made member of the Luchese crime family and a one-time capo, or captain, in that organization. Testimony has also included details about an attempted mob hit on Halloween night in 1989 in which Scarfo was shot and nearly killed.

His lawyer, Michael Riley, has told the jury that his client has been targeted not for anything he has done, but for who he is. His name and his father's infamous reputation nearly got him killed, Riley said while implying that those same factors were key elements in the government's decision to charge him in the current case.

Also on trial are former FirstPlus CEO John Maxwell, Maxwell's brother William, a lawyer who worked for FirstPlus, and attorneys David Adler, Gary McCarthy and Donald Manno. Manno, who was Scarfo's criminal defense attorney for years, has represented himself during the trial.

The case, which began in January, has included testimony for several former company insiders, including Cory Leshner whose stint on the witness stand provided some of the most damaging testimony. Leshner is one of six co-defendants indicted along with Scarfo and the others who pleaded guilty. He is the only one to testify for the government. Scarfo's wife, Lisa Murray-Scarfo and his cousin, John Parisi, also entered guilty pleas. Leshner, Parisi and Murray-Scarfo have not been sentenced.

The evidence introduced during the trial broke the defense into three sections.

Scarfo, Pelullo and the Maxwell brothers were portrayed as the most actively involved in the systematic looting of the company. Much of the cash funneled as consulting fees to companies controlled by Scarfo and Pelullo went through William Maxwell, who was on a $300,000 monthly retainer to First Plus.

Two of the other lawyers, Adler and McCarthy, were tied to what the government alleges were failures to properly account for business dealings with the SEC or other government regulators. Manno was tied to fraud allegations centered primarily on an escrow account that the government alleges was set up to allow Scarfo and his wife to purchase a $715,000 home outside of Atlantic City.

The home was one of several lavish purchases allegedly financed with cash taken from FirstPlus. The government also alleged that Scarfo and Pelullo purchased an $850,000 yacht (named Priceless), a company jet and luxury automobiles. Pelullo spent $217,000 on a black, 2006 Bentley Continental GT, according to testimony. Scarfo leased an Audi S6 for $1,200-a-month on the company's dime, authorities allege.

The FirstPlus investigation became public in May 2008 when the FBI staged a series of coordinated raids in Philadelphia, South Jersey, Miami -- where Pelullo had a condo and where the yacht was docked -- and Irving, TX, where FirstPlus was based.

More than three years later, in November 2011, a federal grand jury in Camden handed up a 107-page, 24-count indictment outlining the charges in the case. Scarfo's 84-year-old father and another jailed mob leader, Vittorio "Vic" Amuso, 80, were named unindicted co-conspirators. Amuso was the boss of the Luchese crime family. He is serving a life sentence. The elder Scarfo is serving a 55-year term for murder and racketeering. His earliest release date, according to prison records, is 2033 when he will be 103 years old.

Kugler has dismissed a handful of counts during the course of the trial, but none of the major charges. The closing arguments are expected to last several days (the jury does not sit on Fridays). D'Aguanno's closing could run into Thursday. Scarfo's attorney is expected to offer the first defense closing, followed by lawyers for Pelullo, the Maxwell brothers, Adler, McCarthy and then Manno.

Under the rules of federal criminal trials, the prosecution will then get the last word, offering a rebuttal closing. Jury deliberations are expected to begin late next week at the earliest. Scarfo and Pelullo face the stiffest potential sentences, 30 years to life.

George Anastasia can be contacted at George@bigtrial.net.

Read more at http://www.bigtrial.net/2014/06/closing-arguments-due-in-firstplus.html#rA5rQEuRH7gj6djT.99

Best Friends Til The End! Besties Selfie hahah

Who was the Jersey capo before Scarfo? And WAS Scarfo the capo in charge of Ralph Perna?

Nice pic steve-o

Robert Caravaggio.

Bucky

saw this after, yup

Was Scarfo in charge of Perna before Perna got bumped up?

I would imagine so.

WEDNESDAY, JUNE 4, 2014

Layers Of An Onion Define Multi-Million Dollar FirstPlus Fraud
By George Anastasia
For Bigtrial.net

A federal prosecutor used mobster Nicodemo S. Scarfo's own words today to describe the alleged takeover and looting of a Texas-based mortgage company that is at the heart of what authorities charge was a $12 million scam orchestrated by Scarfo and his business partner Salvatore Pelullo.

"Layers upon layers, like an onion," Scarfo, 48, said in a secretly recorded telephone conversation with Pelullo, 46, that was picked up on an FBI wiretap back in 2007 as authorities contend the takeover of FirstPlus Financial was unfolding.

For nearly three hours today, Assistant U.S. Attorney Stephen D'Aguanno, the lead prosecutor, detailed the allegations in the racketeering conspiracy case against Scarfo, Pelullo and five co-defendants. D'Aguanno said underneath those layers of the onion -- false SEC filings, phony stockholder reports, bogus consulting contracts and fraudulent business purchases and expenses -- was the financial scam that poured millions into the pockets of the two lead defendants.

"They're joined at the hip, from their criminal activities to their alleged business activities," D'Aguanno said of Scarfo and Pelullo, who frequently referred to each other as cousins even though there was no blood relationship.

D'Aguanno called Pelullo the "de-facto" head of FirstPlus Financial. He said Pelullo "controlled" the company and that he "reported" to Scarfo. Both men had lucrative consulting contracts once they secretly took control of the company's board of directors in the summer of 2007, the prosecutor alleged.

Co-defendant William Maxwell, a lawyer on a retainer of $100,000-a-month to FirstPlus, helped set up those consulting agreements with Seven Hills Management, Pelullo's company, and Learned Associates, Scarfo's front, according to the prosecution.

Pelullo had a contract similar to Maxwell's that paid him $100,000-a-month. Scarfo's contract called for $33,000-a-month. He later had another contract with Maxwell for $150,000-a-year, the prosecutor said.

None of those deals were ever disclosed in SEC filings or reported to company shareholders, said D'Aguanno who then asked the jury a question that he repeated again and again - "Why?"

The answer, he said, was because the deals were part of a massive fraud set up by Scarfo and Pelullo, both of whom had criminal records that would have had to have been disclosed had their names been listed on company filings.

Pelullo has two prior fraud convictions and was cited in the past for lying to the SEC, D'Aguanno said. Scarfo has two prior convictions linked to organized crime gambling and racketeering cases.

D'Aguanno is expected to continue his closing argument when the trial resumes tomorrow. He will then be followed by the seven defense attorneys who will also address the jury. First up is Michael Farrell, one of two court-appointed attorneys representing Pelullo. Farrell, a high energy litigator with a loud and aggressive courtroom style, is expected to take three or four hours to present his closing.

With no court on Friday, the other closings will likely resume on Monday and last most of the week before jury deliberations can begin.

The defense, as it has throughout the five-month old trial, is expected to argue that the failures of FirstPlus were not caused by fraud, but by a poor economy. Defense attorneys have also argued that the government has interjected the presence of organized crime in the case to sensationalize what would otherwise be mundane financial charges that have little basis in fact. They also have contended that any chance FirstPlus had of succeeding ended when the FBI staged a series of raids in May 2008, seizing company records and assets.

D'Aguanno told the jury that the criminal enterprise at the heart of the FirstPlus fraud was not the mob, but the Scarfo-Pelullo organization. He said, however, that both men used the reputation of organized crime to bolster the threats and extortion that allowed them to take over the company in the summer of 2007.

Scarfo's father, jailed Philadelphia mob boss Nicodemo D. "Little Nicky" Scarfo, and Vittorio "Vic" Amuso, the jailed leader of the Luchese crime family, were named as unindicted co-conspirators in the case. The elder Scarfo exercised "influence and control" of his son and Pelullo, D'Aguanno said, adding that both mob leaders -- even though they were in jail -- were to share in the financial benefits of the takeover.

Scarfo Sr. and Amuso were fellow inmates at a federal prison in Atlanta in 2007. Pelullo and Scarfo Jr. visited the elder Scarfo several times and discussed the FirstPlus takeover with him, D'Aguanno charged. Scarfo Jr. has been identified as a made member of the Luchese organization.

D'Aguanno also said a prison conversation between the two Scarfos in which they mentioned taking care of "Uncle Vic" was a coded reference to Amuso and his potential share in the looting.

Scarfo Jr. was on probation at the time the fraud unfolded, D'Aguanno said. He said that Pelullo, William Maxwell and Donald Manno, a co-defendant and longtime criminal attorney for Scarfo, were part of a scheme to lie to the probation department about Scarfo's associations and job opportunities in an fraudulent attempt to have his probation restrictions lifted.

If Scarfo had gainful, legitimate employment as a consultant for FirstPlus, why not just tell that to the probation department, D'Aguanno asked? The reason, he said, was that that disclosure might have led to government inquiries into what he was doing and disclosed his relationship with Pelullo.

Ironically, D'Aguanno said, authorities were already investigating those connections while Scarfo and the others tried to hide them.

Other defendants in the case include William Maxwell's brother, John, who was the CEO of FirstPlus after the alleged takeover and attorneys David Adler and Gary McCarthy who handled business and SEC filings for the company.

D'Aguanno opened his remarks by playing a tape for the jury in which Scarfo and Pelullo laughed and joked about the untimely passing of J.D. Draper, a FirstPlus insider who authorities said helped the two plan the behind-the-scenes takeover.

Draper, who was named compliance officer of the company, died unexpectedly of a heart attack in December 2007. On the tape, Scarfo and Pelullo mockingly talk about how they are broken up by his passing.

D'Aguanno said Draper was one of the few insiders who knew all the details of the scam and his passing eliminated any concerns on the part of Pelullo or Scarfo that he might turn on them and go to authorities.

"I'm crushed, tears are coming to my eyes," Pelullo said on the tape which was played twice during the trial and a third time today.

After more mock comments about sorrow and condolences, Scarfo told Pelullo that Draper's death was "one thing I know you can't take credit for."

But the government contends that Pelullo, in secretly recorded conversation and in emails, took credit for nearly everything else that brought him and Scarfo behind-the-scenes control of the company. And all of it, D'Aguanno said today, was based on fraud.

George Anastasia can be contacted at George@bigtrial.net.

Read more at http://www.bigtrial.net/2014/06/layers-of-onion-define-multi-million.html#z8ssUGKIhm3trFIC.99

Technically yes but i doubt any of those guys respected him.

Mafia Smoke, No Fire In Fraud Case, Pelullo's Lawyer Says

By George Anastasia
For Bigtrial.net

He wasn't a gangster. He was a turnaround expert.

And if the government had just left him alone, Salvatore Pelullo would have turned FirstPlus Financial, a struggling Texas mortgage company, into a profitable business enterprise.

Do the math!

That was the message, accompanied by nearly 100 slides and a heavy mixture of passion and sarcasm, that Pelullo's lawyer, Michael Farrell delivered to a federal jury today in a highly charged summation that offered a decidedly different view of the testimony and evidence from the one presented by the prosecution during the five-month trial.

The government, Farrell said repeatedly, failed to back up its charge that Pelullo and mobster Nicodemo S. Scarfo looted the company after secretly taking control of its board of directors in the summer of 2007.

"The government never gave these people a chance and they want you to convict them of crimes," said Farrell, the first of seven defense attorneys to offer closing arguments. Farrell will be back in front of the jury when the trial resumes Monday. He is expected to take most of the day to complete his summation.

"This is a guy with a track record of immense business success," Farrell said of his client, pointing to businesses Pelullo had started in the past, to a newspaper article identifying him as one of the top 40 businessmen under 40 and personal financial records that listed properties and assets that at times exceeded $1 million.

Farrell described Pelullo, 46, as a high school dropout with intuitive business acumen who had developed a "business model" for taking distressed companies and turning them into successful operations. He was, Farrell added, a "risk taker" who had run afoul of the law in the past. Pelullo has two prior fraud convictions.

But the defense attorney, contradicting a major premise in the prosecution's case, said there was never any attempt to hide Pelullo's role as a consultant to FirstPlus or to defraud the company.

"Loot the company?" he nearly shouted at one point. "They were trying to grow the company."

Farrell's summation came after Assistant U.S. Attorney Stephen D'Aguanno wrapped up nearly six hours of closing arguments shortly after the lunch break today. D'Aguanno described Pelullo as the "central figure" in a scam built around "a fraudulent set of legal and consulting agreements."

He said Pelullo and Scarfo use fear, intimidation and the reputation of the mob and their links to it to advance a scheme that netted them millions while running the company into the ground. Both Pelullo and Scarfo, through companies they controlled, had consulting contracts with FirstPlus. A third defendant, lawyer William Maxwell, had a legal contract with the firm.

Maxwell was being paid $100,000-a-month plus expenses. The government contends he set up consulting contracts for Pelullo, at $100,000-a-month, and Scarfo, at $33,000-a-month, as part of an insider move to siphon cash out of the company.

Other defendants on trial are Maxwell's brother, John, the CEO of FirstPlus, and lawyers David Adler, Gary McCarthy and Donald Manno.

Using slides and charts that flashed on large screens around the courtroom, Farrell challenged the goverment's contention that after Pelullo and Scarfo took control of the company board of directors, its assets dropped from about $11 million to $1,700. In fact, he contended, companies that were purchased by FirstPlus had tangible value of millions and were not the straw entities that the prosecution alleges.

The purchases -- the government has charged that Pelullo and Scarfo controlled most of the companies that FirstPlus bought -- were part of a plan to turn the company around, part of a business model that Pelullo had developed and used successfully over the years.

Farrell also chided D'Aguanno and FBI Agent Joe Gilson, the lead investigator in the case. The defense attorney implied that the two law enforcement officials lacked the financial background and training to accurately assess what was taking place.

He said the FBI targeted Scarfo, the son of jailed Philadelphia mob boss Nicodemo D. "Little Nicky" Scarfo, because of his suspected mob ties. The younger Scarfo was on probation in 2007 after serving more than three years in prison for a conviction in an orgnaized crime gambling case. He has another conviction for racketeering.

The organized crime investigation into Scarfo, dubbed "Son Block," morphed into a probe of white collar corruption, Farrell said, and went off track because the government didn't understand the financial world.

The government "wants you to believe Scarfo was a mobster," Farrell told the jury. The evidence and testimony indicate he was "a computer nerd," the lawyer said.

Both Pelullo and Scarfo had criminal records and were cognizant of the fact that those records could create problems with government regulators and shareholders. But neither attempted, as the government alleges, to hide their involvement as consultant to the company, he said.

"They had strikes against them," he said of their criminal pasts. "They had obstacles. But they believed they could succeed."

Returning to another theme that has been part of the defense throughout the trial, Farrell said a series of FBI raids in May 2008 in which FirstPlus records were seized and Pelullo and Scarfo were identified as targets thwarted any attempt for the company to succeed. It wasn't fraud, but the government's actions, he argued, that deep sixed FirstPlus Financial.

He urged the jury not to buy into the government's arguments.

"They believe you'll convict solely because of the Mafia smoke," he said. But it's smoke, he said, with "no fire."

George Anastasia can be contacted at George@bigtrial.net.

I love how another guys lawyer calls scarfo a computer nerd. he must just keep his face down stairing at a paper.that's a first.

I don't see how they can convict here. Verdict should be in soon.

I completely disagree. They're both done in my opinion.

Should be interesting to see which one of these two flips - if not both - although I don't know what Pelulio would have that the coppers wanted but Scarfo is a different story - imagine how Nick Scarfo Sr. would react to his son turning?

He'd fucking kill himself!

we will see

really? always respect posts but did you read the indictment?

these guys are cooked

Was there concrete financial evidence? Besides them collecting a salary? I'm honestly a little unsure, at work right now. Like what exactly do they have on a scarfo?

I didn't.read the indictment btw, maybe I take a look tonight while I.watch the game

Imagine that huh! You're quite the optimist there guy. Maybe you should go join Fox 29 news with your buddy Dave there guy!