The Octopus at the Vatican

# 2 - the holy father fence

1969 - the Vatican

Nine years later, the two men had become friends and had fulfilled their dreams. But their features had aged. Montini had been elected pope in 1963, becoming Paul VI.

Paul Marcinkus, his bodyguard, was becoming too inquisitive of his private life; he appointed him bishop and head of the Vatican Bank, to get rid of him. But Marcinkus, a bruiser from the Chicago slums knew nothing about banking. All he could do was play golf, smoke cigars, swing a baseball bat and get into fights.

The old pope Pie XII had bought loads of shares in Italian companies. He wanted to control Italy. But this papal wealth was palpable. It created discontent in the country. Paul VI decided to get rid of them. Not by giving them to the poor, but by sending them abroad. If the Church was to continue its donations to charitable organizations forever, world without end, it could only do so by remaining prosperous. Not by becoming poor!

-Mr. Sindona, could I see you with Bishops Marcinkus?

The four men, including Father Machi gathered. The pope disclosed his intention to reduce the clergy's wealth in Italy.

"Let's start with shares, as Italy wants to tax our dividends. On Milan's stock exchange, what is the value of our 20% in Societa Generale Immobiliare, our 60% in Condotte d'Acqua, distributing water in Rome as well as our minority control in Ceramica Possi?"

Sindona and Macchi made a rough calculation: 20 million dollars.

"Would you be interested in the lot, the pope asked Sindona?"

"Yes, Holy Father, and I'll offer you 25 million."

It was another multiplication of the loaves. Paul VI slipped a word to his secretary to offer a prayer of thanksgiving at vespers. Cosa Nostra would pay the 25 million. It was going to be complex to split the capital flow in transit, needing brass-plate companies and banks from various countries. Sindona had acquired quite a few. The Mafia would inject 25 dirty millions and recuperate 15, white as heroin. The 10 million dollars difference would be shared between Sindona, Calvi and Marcinkus. Discounts would go to facilitators like the poisonous Licio Gelli, the P2 lodge Venerable, as well as American mafiosi. Organized crime was buying the Vatican's Italian goods in this smokescreen, while laundering the funds. The mob wouldn't be getting the same shares. They would be given other assets than the three initial lots of shares. These would be split up, repackaged in the wastewater treatment plant, and resold to international investors, suckers who would pay high prices for them. Same as Texon, close to Credit Suisse, who would then reinject the dirty money into Italy for its. . . Italian clients.

Many identical operations took place later on. The emptying of the Italian Church portfolio and the laundering took place, hand in hand. The Holy Father was recycling heroin money.

March 1974 - New York

Five years later, Michele Sindona was sitting opposite his Creator. Don Carlo Gambino, the Capo dei tutti Capi, had changed since 1957 when the two of them had met for the first time in Palermo. He was now seventy years old and, with a heart condition, was showing his age.

"Well, Michele, what do you have to tell me?"

Sindona decided to come clean. It was no use to start messing about.

"Don Carlo, I gambled and I lost. My financial empire is falling apart. It's like a sand castle caught by the rising tide. I have no excuse. Apart from underestimating the devastating power of the oil crisis. Even the mightiest were affected. My system wasn't strong enough. It was built to deal with normal forecasting. Not fit for the financial and economic hurricane we are experiencing. I am taking responsibility for this."

"I appreciate your honesty, said the boss."

Gambino turned towards his Consigliere.

"How much money do we have in Michele's system?"

"Sixty million dollars after laundering."

"Can you give it back?" Gambino asked Sindona.

The only possible answer was yes. No would mean death.

"Yes", said Sindona. "I have some advice and a request, Don Carlo."

"I'm listening."

"My system is rotten. I have to abandon ship. Would it be possible not to submit any more funds as from now on? I can offer no guarantee for the future. It's OK for the past but not for the future."

"Is this possible, Consigliere?"

"We can close the debit system within three to four days."

"Can we cope elsewhere?"

"Yes, we've got spare wheels."

Gambino got back to Sindona.

"Good. Michele, when are you going to give those 60 million back to the family?"

"By this week. All I need is an account number."

"All right. Consigliere, please give it to Michele."

He got up, hugged Sindona:

"We've done a good job together, I'm pleased. Everything comes to an end on this earth. Take care and try to cut your losses."

He sent him away after giving him his ring to kiss.

After Sindona left, Gambino told the Consigliere:

"Sindona remains in the family, but he's out as our financier. Who would you suggest for this post?"

"Roberto Calvi from Ambrosiano Bank."

"OK. Get on with it."

Everybody lost in Sindona's crash, apart from the mafia. The biggest loser was the American taxpayer. Sindona, with 20% of shares, controlled the Franklin National Bank, the 20th ranked American Bank. The US Treasury came to the rescue when it was almost bankrupt, to avoid chain reactions and the systemwide shock its downfall would have created. It injected two billion dollars.

September 1974 - Rome

On September 3rd, Licio Gelli, the Venerable of P2 Lodge, received a call.

"Sindona will be arrested the day after tomorrow, I thought you might be interested."

"Thank you, my dear friend, I won't forget that one!"

Then Michele Sindona received a call.

"Michele, you'll be arrested the day after tomorrow."

"Thank you, Licio. I won't forget that one!"

On September 4th, Michele Sindona, who was now also a Swiss citizen, took off for Geneva. Then for the US to his suite at the hotel Pierre off Central Park.