Banking For God,The Mob And The CIA

Fight disinformation: Sign up for the free Mother Jones Daily newsletter and follow the news that matters.


Often, the CIA and a government like the Vatican will interact in major ways through one person. Such is the case with Michele Sindona. Sindona rose from peasant roots in Sicily to become one of the most influential bankers in the western world. At the height of his power, Sindona lorded over a financial empire that stretched from Rome to Hollywood and included half the largest banks in Switzerland. He con-trolled hundreds of corporations and counted among his part-ners such influential allies as David Kennedy, treasury secretary under Richard Nixon, and Archbishop Paul Marcinkus, presi-dent of the Vatican bank. (Marcinkus is currently dodging Italian police, who wish to question him regarding his role in the collapse of Banco Ambrosiano, Italy’s largest private bank.)

Described by a former colleague as “a snake charmer,” Sindona had a knack for making the right connections. In the 1950s he befriended Giovanni Montini, then archbishop of Milan, whose esteem for Sindona was cinched when the banker do-nated $2.4 million to the church for an old people’s home. (Luigi DiFonzo, in his recently released book, St. Peter’s Banker, suggests that the money which Sindona raised in a single day was provided by a CIA operative stationed in Milan.) Some years later, after Montini had become pope, he brought on Sindona to manage the Vatican’s immense financial portfolio.

One of the world’s greatest fiscal powers, this sovereign mini-state of 109 acres had investments in every sector of the Italian economy, as well as abroad. But what appealed to Sindona most of all about the Vatican was the excessive secrecy associated with its multi-billion-dollar banking arm, the Institute per le Opere di Religione (IOR). Because the Vatican is not subject to Italy’s stringent currency regulations, the IOR is able to move huge sums throughout the in-ternational money market, while eluding auditors and the like. In effect, it operates in a fiscal twilight zone, im-mune to outside interference, in a manner similar to an off-shore bank.

“God’s banker,” as Sin-dona was known because of his close association with the Vatican, proffered his services to a number of other influential clients. He was a top financier for the international Mafia, laundering drug profits for the Gambino brothers and their Sicilian counterparts. At the same time, he functioned as a financial conduit for numerous CIA operations, passing funds, for example, to the Greek colonels before they seized power in 1967. He later channeled millions of CIA dollars to centrist and right-wing political parties in Italy, including the ruling Christian Democrats.

During his heyday as a CIA operative, Sindona was also paymaster for Propaganda Due (P-2), the most secretive cell in Italian freemasonry, led by Grand Master Licio Gelli, a die-hard Mussolini fascist. Gelli and his piduisti. as P-2 members were called, have been implicated in a series of financial and political scandals that rocked Italy in recent years, including a wave of
spectacular bombing attacks by right-wing terrorists that culminated in the 1980 Bologna train station massacre, in which 80 people were killed and 160 injured.

Sindona and Gelli were also involved in several foiled coup plots against the Italian government in the 1970s. It was during that time that Sindona’s luck began to sour. Franklin National Bank, his major American acquisition, collapsed in 1974, triggering a chain reaction of foreclosures that continued until Sindona’s entire empire lay in a shambles. The Vatican bank, a silent partner in many of his business schemes, took a ferocious beating. Sources inside the Vatican estimate that as much as S200 million was lost as a result of il crac Sindona (the collapse of the Sindona empire).

In August 1979, shortly before he was due to stand trial in New York in connection with the sacking of Franklin National Bank, Sindona mysteriously disappeared. Word circulated that he had been kidnaped by a group calling itself the Proletarian Committee for Better Justice. Sindona later admitted to the FBI that he had masterminded hi&’own kidnaping with the help of American crime boss John Gambino and other “Sicilian pa-triots.” During his 11 weeks underground, Sindona flew to Eu-rope and slipped across the border into Italy.

While in Italy, Sindona reportedly gathered documents that were damaging to almost everyone with whom he had done business. His files contained the names of more than 500 prominent Italian industrialists and politicians — even Vatican officials who had used his banks to move fortunes out of the country. He also collected records of his machinations with American businessmen and, most significantly, memoranda pertaining to his relationship with the CIA. Sindona planned to use this information to persuade authorities in Italy and the United States to modify some of the charges pending against him.

The feisty Sicilian reappeared in New York in Octo-ber 1979, confident of a victory in the courts. But his hopes were dashed when Arch-bishop Marcinkus and two other Vatican officials, after stating their intention to do so, declined to testify as char-acter witnesses.

In March 1980, Sindona was convicted on 68 counts of fraud, misappropriation of bank funds and perjury. Having survived a suicide attempt made two days before he was to be sentenced, Sindona is currently serving a 25-year sentence in a U.S. federal prison in upstate New York. In addition. Sindona faces charges
in Italy for banking violations, fraud, drug trafficking and murder, and has been indicted in Sicily along with members of the Gambino Mafia clan for trafficking heroin from Sicily to America. Sindona recently wrote a 31-page letter to President Reagan asking that his case be reopened. The letter was hand-delivered to Reagan’s personal attorney by David Kennedy. White House spokespeople have refused to disclose whether Reagan has responded. — M.A.L.

AN IMPORTANT UPDATE

We’re falling behind our online fundraising goals and we can’t sustain coming up short on donations month after month. Perhaps you’ve heard? It is impossibly hard in the news business right now, with layoffs intensifying and fancy new startups and funding going kaput.

The crisis facing journalism and democracy isn’t going away anytime soon. And neither is Mother Jones, our readers, or our unique way of doing in-depth reporting that exists to bring about change.

Which is exactly why, despite the challenges we face, we just took a big gulp and joined forces with the Center for Investigative Reporting, a team of ace journalists who create the amazing podcast and public radio show Reveal.

If you can part with even just a few bucks, please help us pick up the pace of donations. We simply can’t afford to keep falling behind on our fundraising targets month after month.

Editor-in-Chief Clara Jeffery said it well to our team recently, and that team 100 percent includes readers like you who make it all possible: “This is a year to prove that we can pull off this merger, grow our audiences and impact, attract more funding and keep growing. More broadly, it’s a year when the very future of both journalism and democracy is on the line. We have to go for every important story, every reader/listener/viewer, and leave it all on the field. I’m very proud of all the hard work that’s gotten us to this moment, and confident that we can meet it.”

Let’s do this. If you can right now, please support Mother Jones and investigative journalism with an urgently needed donation today.

payment methods

AN IMPORTANT UPDATE

We’re falling behind our online fundraising goals and we can’t sustain coming up short on donations month after month. Perhaps you’ve heard? It is impossibly hard in the news business right now, with layoffs intensifying and fancy new startups and funding going kaput.

The crisis facing journalism and democracy isn’t going away anytime soon. And neither is Mother Jones, our readers, or our unique way of doing in-depth reporting that exists to bring about change.

Which is exactly why, despite the challenges we face, we just took a big gulp and joined forces with the Center for Investigative Reporting, a team of ace journalists who create the amazing podcast and public radio show Reveal.

If you can part with even just a few bucks, please help us pick up the pace of donations. We simply can’t afford to keep falling behind on our fundraising targets month after month.

Editor-in-Chief Clara Jeffery said it well to our team recently, and that team 100 percent includes readers like you who make it all possible: “This is a year to prove that we can pull off this merger, grow our audiences and impact, attract more funding and keep growing. More broadly, it’s a year when the very future of both journalism and democracy is on the line. We have to go for every important story, every reader/listener/viewer, and leave it all on the field. I’m very proud of all the hard work that’s gotten us to this moment, and confident that we can meet it.”

Let’s do this. If you can right now, please support Mother Jones and investigative journalism with an urgently needed donation today.

payment methods

We Recommend

Latest

Sign up for our free newsletter

Subscribe to the Mother Jones Daily to have our top stories delivered directly to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate