``If he wanted to pursue those kinds of deals he should have done it with his own money,'' said Assistant U.S. Attorney Mark W. Rufolo, who prosecuted the case. ``Gambling with other people's money - particularly pension and retirement fund money - is wrong.''
Pelullo, who is already serving a 24-year sentence for his conviction on fraud and racketeering charges in federal court in Philadelphia last year, is scheduled to be sentenced on Jan. 27. Each money-laundering count carries a possible 20-year sentence, Rufolo said. The conspiracy and embezzlement counts each carry possible five-year sentences.
Pelullo's lawyer, Herbert Beigel, could not be reached for comment.
During the trial, Beigel argued that Pelullo was trying to rescue Compton from financial problems it had when he took over the firm. The company, which had been in business for 35 years, folded in 1991.
Pelullo is the target of a civil suit brought by lawyers for the trustees of the pension and retirement funds. Compton employed about 100 people just before it went out of business.
Yesterday's conviction comes after a series of trials in federal court in Philadelphia in which Pelullo was accused of converting more than $2 million designated for a Miami Beach hotel redevelopment project to his own use.
Prosecutors in that case said that Pelullo, through development companies he controlled in Florida, used $2.2 million that had been lent to the companies to finance a lavish lifestyle that included a palatial house in Miami, a horse farm in Chester County, and a sheep ranch in Montana. The development project - restoring six Art Deco hotels in Miami Beach - floundered, and the hotels were later sold off to satisfy creditors.
That case included testimony from mob informant Philip ``Crazy Phil'' Leonetti, the former underboss of the Philadelphia mob, who described Pelullo as a one-time associate of his uncle, jailed mob boss Nicodemo ``Little Nicky'' Scarfo. Leonetti also testified that he collected a $114,000 loan-shark debt from Pelullo. Authorities charged that the money to pay off that debt came from the development funds that Pelullo defrauded.
Pelullo was tried four times on the fraud and racketeering charges. His first two convictions were overturned on technicalities. A third trial ended with a hung jury. A fourth trial ended last year with a conviction and the reinstatement of the 24-year jail term imposed after his first conviction in 1991.
That conviction is again on appeal.
Pelullo is also expected to appeal yesterday's conviction.