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.