Nicodemo S. Scarfo was denied bail Monday in a multimillion-dollar fraud case, but he may be released soon from solitary confinement while awaiting trial.

Following a brief hearing in Camden, U.S. District Judge Robert Kugler accepted prosecution arguments that Scarfo, a made member of the Lucchese crime family, was a danger to the community and should remain behind bars while awaiting trial on racketeering, conspiracy, fraud, and money-laundering charges.

But Kugler urged the U.S. Attorney's Office to lift a request that Scarfo remain in a Special Housing Unit at the Federal Detention Center in Philadelphia after Scarfo said he wanted to be in general prison population.

Prosecutors had expressed concern for Scarfo's safety because several members of a faction of the Philadelphia mob allegedly involved in an attempt on his life in 1989 are prisoners at the detention center.

"That was no hunting accident," Kugler said when questioning Scarfo about safety concerns.

Scarfo was shot and nearly killed as he dined at Dante's & Luigi's Restaurant in South Philadelphia on Halloween night 22 years ago. No one has ever been charged with the shooting, but authorities believe a rival faction of the mob targeted Scarfo in a dispute with his father, jailed mob boss Nicodemo D. "Little Nicky" Scarfo.

"I don't feel my life is in danger," Scarfo told Kugler during Monday's hearing.

Scarfo, 46, has been held without bail and in solitary confinement since his arrest Nov. 1. He is limited to one phone call per week to his lawyer and one phone call per month to his wife, a codefendant in the case.

In a 25-count indictment handed up last month, he is charged with orchestrating the takeover and looting of FirstPlus Financial Group, a Texas mortgage lending company.

Assistant U.S. Attorney Lisa Page said he and codefendant Salvatore Pelullo, 45, used "elaborate and expensive steps to conceal their involvement" in FirstPlus.

Authorities allege that between June 2007 and May 2008, the two defendants exercised behind-the-scenes control of the company. During that period, the indictment charges, Scarfo and Pelullo siphoned more than $12 million out of the company through questionable business transactions and bogus consulting contracts.

Page cited one secretly recorded conversation in which Scarfo talked about "layers upon layers" of documentation designed to hide his involvement, pointing out that he had a $36,000-a-month consulting contract for which he did "virtually no work."

Page argued that Scarfo and Pelullo used their alleged mob connections and Scarfo's name as leverage as they forced their way into the company.

Thirteen defendants have been charged in the case, including four lawyers, an accountant, and Scarfo's wife, Lisa Murray-Scarfo. Only Scarfo and Pelullo have been denied bail.

Pelullo, identified by authorities as a mob associate, was the point man in the FirstPlus scheme, Page said, traveling to Texas and meeting with company officials. But, she added, Scarfo, with his mob ties and underworld reputation, provided the clout Pelullo needed to force his way into the company and intimidate those who might oppose him.

Contact staff writer George Anastasia at 856-779-3846 or ganastasia@phillynews.com.