A federal jury in New Jersey Monday convicted Lucchese crime family figures Nicodemo "Little Nicky" Scarfo and Salvatore Pelullo of racketeering conspiracy, securities and bank fraud, mail and wire fraud, money laundering and obstruction of justice charges in a scheme to take over FirstPlus Financial Group in Texas.

In addition to Scarfo, 49, of Galloway, N.J., and Pelullo, 47, of Philadelphia, the jury also convicted a pair of Texas brothers, William and John Maxwell. Three other defendants were acquitted.

“Today, four people stand convicted  for giving new meaning to ‘corporate takeover’ -- looting a publicly traded company to benefit their criminal enterprise,” U.S. Attorney Paul J. Fishman said. “The defendants stole more than $12 million from shareholders through rampant self-dealing, fraudulent SEC [Securities and Exchange Commission] filings and intimidation. The public should not have to worry that the interests of shareholders are being subverted to benefit organized crime or for other corrupt ends.”

The U.S. attorney's office described Scarfo as a member of the Lucchese crime family and said Pelullo was an associate of the organization.

The defendants were convicted of threatening FirstPlus' management and board members, orchestrating a takeover that put the Maxwell brothers in charge. William Maxwell then funneled some $12 million out of the institution through charges for fraudulent legal services and consulting agreements.

A telephone intercept showed Pelullo and Scarfo laughing about the death of a former FirstPlus executive who had helped Pelullo and Maxwell take control of the company.

“The rat is dead,” Pelullo said during the conversation, pointing out the executive was “the only connection, the only tie to anything.”  Scarfo replied: “Oh boy.  Yeah, Sal, you wanna know something though?  That’s one that I know you can’t take credit for …  [laughter] … and that’s the natural best thing.  You know what I mean?  That is so like Enron-ish.  You know what I mean?   Kenneth Lay, he bailed out and took a heart attack."

Scarfo and Pelullo used money siphoned from FirstPlus for extravagant purchases, including an $850,000 yacht, a luxury home, a Bentley and thousands of dollars worth of jewelry.

Scarfo is scheduled to be sentenced Oct. 22; Pelullo, Oct. 21; and the Maxwell brothers, Oct. 23.