White-Collar Crime

5 Lawyers, Ex-Crime Boss Son Among 13 Indicted in Alleged Lender Takeover by Racketeer Enterprise

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Five lawyers and a certified public accountant are among 13 defendants indicted in a federal racketeering conspiracy and securities fraud case in Camden, N.J. It concerns the alleged use of threats against board members to take over a publicly traded Texas-based subprime lender and loot it of at least $12 million.

Allegedly operated by Nicodemo Scarfo Jr., 46, who is the son of a jailed organized crime boss, and another individual, the claimed scheme targeted FirstPlus Financial Group Inc., beginning in April 2007, according to the Associated Press and the Newark Star-Ledger.

Scarfo is identified in a press release from the U.S. Attorney’s Office in New Jersey as a made member of the Lucchese organized crime family of La Cosa Nostra.

Attorney William Maxwell of Houston is accused by the feds of helping to come up with the idea for the claimed scheme and serving as special counsel to a figurehead replacement board serving at the behest of the alleged criminal enterprise. His brother, John Maxwell, is the bankruptcy company’s former chief executive officer, and was also indicted, Bloomberg reports.

An article in the Cliffview Pilot provides additional details.

Lawyers David Adler, Cory Leshner and Gary McCarthy were also reportedly indicted, but the exact nature of the accusations against them isn’t clear.

Attorney Donald Manno, who represents Scarfo, allegedly abused his position and helped his client and the enterprise by withholding information from Scarfo’s probation officer and the district court concerning his source of income and contact with convicted felons, the U.S. Attorney’s Office press release says.

In addition to racketeering conspiracy and securities fraud, charges in the case include bank fraud, extortion, mail fraud, money laundering, obstruction of justice and wire fraud.

None of the articles include any comment from the defendants or their counsel. The indictments were unsealed this morning, and most of the defendants have been arrested.

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