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Jury selection.
Mob-related case heads to trial in Camde
By Julia Terruso, Inquirer Staff Writer
POSTED: October 28, 2013
Five years after the FBI raided the offices and homes of lawyers and reputed mobsters, looking for evidence of a massive business-looting operation that a federal prosecutor said gave new meaning to the term "corporate takeover," the case is headed to trial.
Nicodemo Scarfo, son of infamous jailed Philadelphia mob boss "Little Nicky" Scarfo, is charged along with alleged mob associate Salvatore Pelullo in a 25-count, 107-page indictment peppered with lines from wiretapped conversations that sound like they were ripped from a mob movie script.
On Monday, potential jurors will arrive at the federal courthouse in Camden to fill out questionnaires - the first step of jury selection, expected to take two to three weeks. The trial will likely last six months.
Scarfo, 47, has been on the scene for years, known as "Mr. MacIntosh" and "Mr. Apple" for his tech-savvy cons. In May 2010, he was sentenced to 33 months in prison for running an illegal sports-betting operation.
Pelullo, 45, is an Elkins Park businessman with alleged ties to Scarfo's crime family. Prosecutors say Scarfo and Pelullo targeted the Texas financial-services company FirstPlus Financial for takeover, dismantled its board of directors, and replaced it with pawns who ran a racketeering scheme that defrauded shareholders of more than $12 million from June 2007 to May 2008.
Four lawyers and a former CEO of FirstPlus, John Maxwell, are also charged with mail and wire fraud and other charges related to the operation of the company.
The government will have to prove Scarfo and Pelullo were behind the scam, though their names appear nowhere in business documents. According to the indictment, wiretapped conversations and alias companies associated with the takeover provide evidence of their involvement.
For the lawyers on trial, legal arguments become a little more complex. New York City attorneys Gary McCarthy and David Adler, Texas attorney William Maxwell, and Scarfo's longtime criminal defense attorney, Donald Manno, will aim to prove they were working in a legal capacity - representing mobsters - and not working with them.
Some of the lawyers charged had requested separate trials, concerned that being listed on the same defendant sheet as an organized-crime figure would deny them due process.
Manno, who is representing himself, argued in legal motions for severance based partly on the fact that his main defense is inadmissable. Manno has represented Scarfo for more than a decade and was continuing in that capacity, he says. But to detail their relationship would reveal Scarfo's record to the jury.
The indictment charges that in April 2007, Scarfo and Pelullo devised a plan to take over FirstPlus and then acquired grossly overvalued straw companies to loot hundreds of thousands of dollars from FirstPlus and its subsidiaries through fraudulent consulting agreements. According to the indictment, they used the stolen money to buy jewelry, luxury cars, a yacht, and a plane.
The evidence includes 8,500 recorded conversations, one million hard-copy documents, and tens of millions of electronic files, according to court papers.
The wiretaps, some of which are quoted in the indictment, will likely make up the crux of the government's case.
In one conversation, Pelullo says, "When I get down there, every single check card that's in the company, I'm going to burn myself."
Four defendants have already pleaded guilty.
Cory Leshner, 30, a West Reading lawyer, pleaded guilty in October and is expected to be a cooperating witness in the case.
Scarfo's cousin John Parisi and Scarfo's wife, Lisa Marie Scarfo, pleaded guilty in September. Howard Drossner pleaded guilty and admitted that at the direction of Pelullo, he created false tax returns to help Lisa Marie Scarfo qualify for a mortgage.
From his jail cell in Philadelphia, Pelullo has been blogging and writing letters to Judge Robert B. Kugler, who will hear the case.
In a recent, and somewhat rambling letter, Pelullo lamented what he's missed while in prison, paraphrases Dylan Thomas, saying, "I will not go quietly into the night," and apologizes for previous behavior in court.
"If I seem brazen or rough around the edges that is who I am," he says. "Is that a crime?"
Scarfo and Pelullo also face charges of possession of an arsenal of weapons.
In May 2008, the FBI found three handguns, two rifles, a shotgun, and more than 2,500 rounds of ammunition on Scarfo's yacht, called Priceless. Both men face 30 years to life.
jterruso@phillynews.com
856-779-3876
@juliaterruso
RICO trial starts tomorrow for Scarfo and associates.
The voluntary delisting, and the consequent uncertainty created among existing and potential shareholders, certainly established a lower base price for CGR, but the fundamental expectation of a significant profit at some higher price of gold remains unchanged. Unbridled speculation is the primary driver for penny stocks and as gold trends higher, my expectation is that CGR will rise in tangent - absent any new announcements by CGR which might be perceived as negative by the markets. The delisting is a desperate move to survive the current manipulation of the price of gold by the politically elite and their market cronies. Once the elites and their minions have all the gold they can reasonably grab without raising the suspicions of the sleeping masses, they will allow the price of gold to shoot up. If the CGR interim survival strategy works, we have a gold mine here. (pun intended)
Top Five Reasons
1. Price of gold,
2. Price of gold,
3. Price of gold,
4. CGR fundamentals
5. Just kidding about #4, it's the Price of gold.
I'm reminded of the old adage, "no news, is good news", with respect to my AVCVF investment.
Compliance costs for the non-reporting stocks on pinksheets would be zero compared a possible $500,000 on the NYSE, although I'm sure CGR was not paying anywhere near $500,000, considering their market cap. Additionally, they would have been thrown off the exchange anyway, for not meeting the minimum share price. The cost of trading on the regular non-reporting pinksheets would be nothing, and should they choose the OTCQX which provides a verified form of transparency, the costs would likely be in the $15,000 range annually. Once the price of gold recovers, I suspect few investors will really care where CGR is trading as long as they have some reasonable expectation the company is turning a profit. If by some illogical twist of markets, gold does not recover, CGR and many other gold miners are probably toast.
Excerpts from Investopedia
Whether a stock trades on the Nasdaq or the NYSE is not necessarily a critical factor for investors when they are deciding on stocks to invest in. However, because both exchanges are perceived differently, the decision to list on a particular exchange is an important one for many companies. A company's decision to list on a particular exchange is also affected by the listing costs and requirements set by each individual exchange. The entry fee a company can expect to pay on the NYSE is up to $250,000 while on the Nasdaq, it is only $50,000 to $75,000. Yearly listing fees are also a big factor: on the NYSE, they based on the number of shares of a listed security, and are capped at $500,000, while the Nasdaq fees come in at around $27,500. So we can understand why the growth-type stocks (companies with less initial capital) would be found on the Nasdaq exchange.
A daily publication compiled by the National Quotation Bureau with bid and ask prices of over-the-counter (OTC) stocks, including the market makers who trade them. Unlike companies on a stock exchange, companies quoted on the pink sheets system do not need to meet minimum requirements or file with the SEC. Pink sheets also refers to OTC trading.
The top tier of the three marketplaces for trading over-the-counter stocks provided and operated by the OTC Markets Group. The OTCQX forum offers the best marketplace of these three tiers for companies that fulfill qualification criteria. To qualify for an OTCQX listing, a company must meet high financial standards, be current in its disclosure and be sponsored by a professional third-party advisor.
Nothing that we know publicly has changed except that CGR will be saving quite a bit of expense associated with the NYSE listing and SEC filing requirements. Of course, only time will tell if the savings will make a difference. Ultimately, it is likely only the price of gold that will determine whether this stock survives or not, but management is ostensibly buying more time to wait for gold to rise.
CGR will trade on the otcbb until they discontinue required reporting to the SEC. At that point, they will trade on the pink sheets in the U.S. The problem will be the lack of transparency, but frankly the savings in expensive listing and regulatory costs will very likely be worth the move. They will have the option of listing on the OTCQX if they want to maintain a cheap, verified form of disclosure.
Well, the 10K is finally out and apparently some shareholders are simply giving up. At this point, the odds don't look good, but sometimes it's the darkest hour when things change. Sorry, but that's the best I can do in the way of optimism.
http://www.sec.gov/Archives/edgar/data/803044/000114420413055358/v356996_10k.htm
USDOJ: Pennsylvania Man Admits Conspiring with Alleged Members of Organized Crime Family and Others in Fraud Scheme
A Pennsylvania man today admitted he conspired to defraud FIRSTPLUS Financial Group Inc. (FPFG), a Texas-based financial services company allegedly targeted for extortionate takeover and looting by a group led by alleged Lucchese organized crime family member Nicodemo S. Scarfo.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and United States Attorney Paul J. Fishman of the District of New Jersey made the announcement.
Cory Leshner, 30, pleaded guilty before United States District Judge Robert B. Kugler in a federal court in Camden, N.J ., to a superseding information charging him with conspiracy to commit wire fraud. He faces a maximum of five years in prison when he is sentenced on January 17, 2014.
http://7thspace.com/headlines/445477/usdoj_pennsylvania_man_admits_conspiring_with_alleged_members_of_organized_crime_family_and_others_in_fraud_scheme.html
"Plunge Protection Team" related?
http://www.zerohedge.com/news/2013-10-11/massive-sell-order-takes-out-gold-bidstack-sends-metal-three-month-lows
That's a pretty safe assumption.
I suspect this announcement will negatively impact the share price at the open, and perhaps for many days to come. Any recovery will likely hang on subsequent press releases about the financial health of the company, execution on the business plan, and of course, the price of gold. As a strategy for controlling expenses, delisting from the NYSE and terminating reports to the SEC probably makes a lot of sense and it will save a significant amount of expense. Hopefully the company will quickly reveal the scope of these balance sheet savings in order to boost shareholder confidence. The OTCQX might be one possibility for maintaining transparency, but whatever they do it will probably have to happen quickly or we shareholders will likely be in for a rough ride in the near term.
http://www.otcqx.com/marketplaces/otcqx
I'm beginning to suspect there may be some type of Federal Reserve supported meddling in the precious metals futures markets, and I have never, ever been in the conspiracy camp before. The only other reasonable explanation for this drop would be the possibly credible world wide recession/depression theories, but with the unfettered creation of fiat money around the world, it still makes little or no sense not to have at least a small position in highly liquid commodities such as gold or silver. No, I think the evidence is mounting for some type of manipulation. I'm currently asking questions and seeking information about the so called, "Plunge Protection Team", officially titled The Working Group on Financial Markets. I'm wondering if they are using the virtually unlimited capacity of the Federal Reserve to protect their massive balance sheet of low interest Treasuries, which would literally crash if interest rates get out of control. The PPT was set up to intervene in a crisis which I think may just be where we are today.
http://en.wikipedia.org/wiki/Working_Group_on_Financial_Market
Of course, this would be dubbed a conspiracy theory, but the idea of a high level and secretive "Plunge Protection Team" buying massive derivative bets against PM's with virtually unlimited funds, in order to prop up their toxic supply of ultra low interest U.S. Treasuries, would explain the seemingly unexplainable. Clearly, something extraordinary is going on in the markets, nothing is normal.
Excerpt from Wikipedia
Former Federal Reserve Board member Robert Heller, in the Wall Street Journal, opined that "Instead of flooding the entire economy with liquidity, and thereby increasing the danger of inflation, the Fed could support the stock market directly by buying market averages in the futures market, thereby stabilizing the market as a whole." His statement has been used to claim that the Fed actually did act in that way. Some mainstream analysts call those claims a conspiracy theory, explaining that such claims are simplistic and unworkable.[13] Author Kevin Phillips wrote in his 2008 book Bad Money that while he had no interest "in becoming a conspiracy investigator," he nevertheless drew the conclusion that "some kind of high-level decision seems to have been reached in Washington to loosely institutionalize a rescue mechanism for the stock market akin to that pursued...to safeguard major U.S. banks from exposure to domestic and foreign loan and currency crises."[14] Phillips infers that the simplest way for the Working Group to intervene in market plunges would be through buying stock market index futures contracts, either in cooperation with major banks or through trading desks at the U.S. Treasury or Federal Reserve.[15]
http://en.wikipedia.org/wiki/Working_Group_on_Financial_Markets
E-mailing and/or calling IR and company officers is not very useful, as the responses have to be carefully cleansed of anything meaningful to avoid regulatory sanctions and fines. Hopefully, someone at the company monitors this board to gauge shareholder sentiment, but of course, we don't have much participation here which probably means we're not on their radar at this point.
I think many long time shareholders have simply given up, but Firstplus and "Don" Scarfo may make the national headlines soon, which should rekindle some interest.
Could we puleasssssseeeee have a press release that is NOT about equity financing?????
NT 10K (notice of late filing) Significant loss again
For the year ended June 30, 2012, the registrant had revenues of $2,216,082 and a net loss of $1,681,279. For the year ended June 30, 2013, the registrant currently estimates that it had revenues of approximately $980,000 and a net loss of approximately $1.25 million. Results for the 2013 fiscal year remain subject to further adjustment.
The decrease in revenues during the 2013 period as compared to the 2012 period is primarily attributable to the decrease in deliverable products and support services billings resulting from continuing delays in release of funding at the Department of Defense and Department of Energy on projects where we serve as a prime contractor and as a subcontractor. The budget constraints and budget uncertainty at the U.S. government agencies have significantly reduced the issuance of orders and delayed projects for all participants in our industry. The net loss for the 2013 period is primarily attributable to the reduced revenues, partially offset by reductions in costs and expenses.
This Notification of Late Filing on Form 12b-25 contains forward-looking statements, including forward-looking statements relating to the Registrant's financial results for the year ended June 30, 2013. These statements are based on management's current expectations and involve a number of risks and uncertainties, including risks described in our filings with the Securities and Exchange Commission. The Registrant's actual results may differ materially from the Registrant's anticipated or expected results and the results in the forward-looking statements.
Pa. lawyer pleads to working with Scarfo Jr. to defraud financial company http://www.philly.com/philly/news/new_jersey/Pa_lawyer_pleads_to_working_with_Scarfo_to_defraud_financial_company.html
RICO trial starts for Scarfo and associates.
Four weeks until showtime in Camden! (assuming no more delays which is admittedly a big assumption)
It's showwwwwtime! (10K day)
Two more trading days till annual report. I'm practically giddy.
What's this? Trading in EKCS? No need to panic though, it can still be had for under a dime.
It's time for management to explain how all this equity financing is contributing to the successful execution of the business plan and provide some convincing evidence it is on track. Otherwise, I suspect we haven't seen the bottom yet. Come on management, the market is getting impatient.
Investors don't like dilution.(unless they are the recipient of the low priced offering)
American Vanadium Increases Size of Financing To $8 Million
http://www.marketwatch.com/story/american-vanadium-increases-size-of-financing-to-8-million-2013-09-16
I'm guessing the last few shareholders who are actually still paying attention have little expectation of sharing in any current or future distributions, because they so accustomed to disappointment they naturally assume it will never make it to the shareholder level. Even the most optimistic of us would logically suspect the legal fees, administrative overhead, and as yet unknown "costs", will scoop up the last few crumbs left behind by the mafia and their associates. Of course, there may be renewed interest in this sorry saga if the upcoming RICO trials garner some national media attention.
Another Associate of Nicky Scarfo Pleads Guilty in Racketeering Case
For the second day in a row, one of the 14 people indicted in a racketeering scheme involving a reputed mob figure from Galloway has pleaded guilty. John Parisi, 52, of Atlantic City, admitted he conspired to defraud Texas-based FirstPlus Financial Group, a publicly traded Texas-based company, U.S. Attorney Paul J. Fishman announced Wednesday evening.
http://galloway.patch.com/groups/police-and-fire/p/another-associate-of-nicky-scarfo-pleads-guilty-in-racketeering-case
Scarfo's wife admits mortgage-fraud conspiracy
The wife of convicted mobster Nicodemo S. Scarfo pleaded guilty Tuesday in federal court to conspiracy related to mortgage fraud that hid her then-fiance's involvement in the purchase of a house in Egg Harbor Township, N.J.....
Read more at http://www.philly.com/philly/news/local/20130918_Scarfo_s_wife_admits_mortgage-fraud_conspiracy.html#uMyMGjQyfVJYfshm.99
Speaking of Raging "Bull", there certainly has been more than enough spread around for FPFX over the years. We should probably check which direction the fan is facing before the RICO trial starts next month, or whenever they reschedule it subsequent to the next delaying tactic.
Are pigs flying yet?
Are you suggesting there is come connection with Comtex other than distributing the news about Apple?
At first blush, this looks like it might be a positive outcome for FPFX shareholders assuming this leads to less bleeding of assets.
http://www.bridgingandcommercialdistributor.co.uk/newsstory?id=729&type=newsfeature&title=suddenly_it_feels_autumnal_
We had some nice size trades at around 11 AM which come days before the anticipated annual and 4th quarter reports. Welcome back from summer vacation.
Delay, followed by more delay, then additional delay with further delay anticipated.
I'm scratching my head over why my buy order of 5000 shares at .039 didn't execute ahead of today's 5000 at .035. The seller didn't want the extra $20? LOL
In case anyone out there cares, we should be just days away from the fourth quarter and annual report. Let's hope some of their high profile contracts went from pending to active during the long hot summer.