A federal grand jury in Philadelphia on Wednesday indicted Miami investor Leonard A. Pelullo on 55 criminal counts stemming from a scheme to defraud American Savings & Loan of Stockton and Royale Group Ltd. of $1.6 million.
The indictment also charges that Pelullo, 40, separately defrauded Miami-based Royale Group of an additional $600,000.
According to the indictment, Pelullo--as chairman of Royale Group--borrowed $13.5 million from American Savings to renovate several hotels owned by Royale. The indictment says Pelullo overstated the renovation costs and kept the difference, about $1.6 million.
Pelullo sparked controversy in Los Angeles last year for his participation in the April, 1990, acquisition of Transcon Lines, one of the nation's largest long-haul trucking firms. The Los Angeles trucking firm entered bankruptcy liquidation a short time after Pelullo's business associates bought it. Transcon Lines is no longer in business.
A court-appointed bankruptcy trustee last fall charged that Transcon Lines' new owners plundered the trucker, siphoning $1.8 million from its bank accounts and leaving it an "empty shell." Pelullo and others involved in the acquisition have denied the allegations.
Wednesday's indictment comes five days after Pelullo was jailed in New Jersey on civil contempt in a separate matter. U.S. District Court Judge Harold Ackerman ordered Pelullo jailed on Friday for defying a court order to refund $1.75 million to the pension fund at Compton Press, a New Jersey printing firm he controls. Pelullo was being held in the Union County Jail in Elizabeth, N.J., Wednesday and was not available for comment.
Pelullo's lawyer, Barry Richard of Miami, could not be reached.
According to the indictment, $114,000 of the $600,000 taken from Royale was used by Pelullo to repay a personal loan under orders from two convicted mob associates, Nicodemo Scarfo and Philip Leonetti. "The shroud of convicted mob bosses is a particularly ominous presence in this indictment," Atty. Gen. Dick Thornburgh said in a statement.
The indictment followed a five-year investigation by the U.S. Attorney and the FBI.