Just after the New Year in 1969, Sindona’s son-in-law—a college friend of Calvi—told Sindona that the Ambrosiano banker wanted to meet him.80 When they got together, Sindona was amused that instead of talking about business, Calvi regaled him with stories about his family and a small retreat he owned near the Swiss border. At one point, he showed Sindona a badly scarred right index finger and then launched into a long account about how he mishandled an ax while killing a turkey at his country getaway. Only at the end of their meeting did Calvi briefly mention that he considered the Ambrosiano an antiquated bank. He hoped to modernize it with Sindona’s help.81
When Sindona asked Calvi’s Ambrosiano boss for his judgment about the young banker, he was told to dismiss whatever Calvi said. The advice to disregard Calvi had the opposite effect on Sindona. His second meeting with Calvi a few days later was all about business. Calvi was direct. He said that the Ambrosiano held large sums of money in safe but dull money market accounts. He would like to use that cash in more aggressive ventures with Sindona. The problem was that the bank’s conservative board of directors was certain to reject it as too risky. Did Sindona, he asked, have any ideas about how to get the Ambrosiano’s cumbersome bureaucracy to free up that money?
Sindona knew that if anyone had influence at the Banco Ambrosiano, it would be the lay officials at the IOR. The Vatican could always use an eager new colleague. If Calvi could gain more power at the Ambrosiano, he might become an integral partner.
Calvi liked the idea. “You must help me. Introduce me to Massimo Spada and ask him to speak on my behalf to the board and the general manager of the Ambrosiano.”82
Sindona introduced Calvi to Spada. Although Spada now worked for Sindona, he had been at the IOR for more than three decades and was still involved on many projects with his former colleagues there. Spada judged Calvi as sincere and eager, and assured him he would try to help. A few weeks later, Calvi went to the IOR and met Luigi Mennini, Pellegrino de Strobel, and Monsignor Marcinkus.83 They all liked the young Ambrosiano banker. Calvi soon ingratiated himself further by hiring one of Mennini’s sons, Alessandro, as an assistant manager in the Ambrosiano’s international division.84
A month before Calvi’s arrival, Pope Paul VI had consecrated the forty-six-year-old Marcinkus as a bishop.85 He also elevated him to be Secretary of the Administrative Office of the IOR, the Vatican Bank’s first non-Italian director.86 Although eighty-four-year-old Cardinal di Jorio was still the highest-ranking prelate on the oversight committee, his role was now an honorary one. Everyone realized that the outspoken American bishop was effectively running the Vatican Bank.87 The ultimate sign of his new power: Marcinkus requested direct access to the Pontiff. Paul VI agreed. Marcinkus was the first cleric inside the IOR to have a straight reporting line to the Pope. Many envied this accommodation.88 Making matters worse for Marcinkus’s enemies, he retained his role as the Pope’s advance man for foreign trips, which gave him a chance to stay personally close to Paul.
Two weeks after his promotion, a Time magazine profile of Marcinkus noted he “is now the key man in Vatican finances,” controlling assets that “run into the billions.” As for his lack of financial experience, “By his own admission, Marcinkus needs all the help he can get. . . . He is a first class organizer, but readily confesses: ‘I have no banking experience.’ ”89,II
The question why appoint him? dominated the gossipy Curia. Cardinals John Wright of Pittsburgh and Michele Pellegrino of Turin expressed to the Pope their concerns about Marcinkus’s inexperience. But Paul VI’s private secretary, Monsignor Pasquale Macchi, told him to ignore the naysayers. Macchi was sick of the imperious di Jorio and he liked Marcinkus, who he thought would learn quickly on the job.91
Some thought that the Pope had selected Marcinkus hoping that his take-command style might shake up the church’s staid finances. But most believed Paul VI wanted to know the details of what was happening inside the opaque IOR. Marcinkus was a trustworthy guard dog who would report honestly.92 Since Marcinkus was tough, the Pope figured he could withstand the IOR’s intensely competitive environment.93 A few even speculated Marcinkus was a stalking horse for the American church, laying the foundation for the future election of a U.S. cardinal as Pope. That theory had legs. Cardinal John Cody, from Marcinkus’s hometown of Chicago, seemed to be the new Spellman. Cody flew to Rome for Marcinkus’s consecration. When boarding his plane, Cody had told a reporter, “Although Bishop-elect Marcinkus has served for many years in important tasks outside the archdiocese, we still consider him one of our own.”94 In the Machiavellian world of the Curia, with ever-shifting allegiances in quests for power, some interpreted that to mean that Marcinkus had dual loyalties that made him untrustworthy. The Pope evidently paid no heed to the chatter.
Mennini and de Strobel were disturbed that the Pope had not weighed financial qualifications as a prerequisite for appointing someone as the overseer of an institution as important and powerful as the IOR. They now had to report to Marcinkus. Their hope was that he might follow in the tradition that the clerics who oversaw the IOR did so passively. That was quickly dashed. Although Marcinkus did not dismiss Mennini, as he had once told Sindona he might, he let it be known he intended to be a hands-on manager.95
Not long after his appointment, Marcinkus summoned Sindona to his office in the squat fifteenth-century Tower of Nicholas V.96 When Sindona arrived, Vittoria Marigonda, Marcinkus’s secretary for a decade, greeted him. Sindona knew Marigonda because she worked briefly at an investment bank at Group Sindona before she moved to the Vatican.97 He also noted several new, young Italian secretaries, prettier than any women Sindona had ever seen working at the Vatican.98 Once he walked inside the bishop’s office, he noticed that di Jorio’s traditional décor had been replaced with modern black leather sofas and chairs, a low-rise glass coffee table, and some large metal sculptures. A golf bag was in the corner, with a tag from Acquasanta (Holy Water), Rome’s most exclusive country club. Marcinkus had moved up from his days of having to sweet-talk his way into playing a round of golf at the SGI-owned Oligata Romana.99 The archbishop had also gotten an “honorary membership” at one of Rome’s oldest and most prestigious clubs, the Circolo della Caccia (The Hunting Club).100
Marcinkus was smoking a pipe and sitting in an overstuffed leather chair. A large pewter ashtray overflowed with Marlboro butts and cigar stubs. The bishop beckoned Sindona to sit in an adjoining chaise.
“I asked for full powers as the condition sina qua non for my accepting the presidency,” Marcinkus told Sindona. He paused for dramatic effect. “And the Holy Father granted them to me.”III
Sindona said nothing but felt Marcinkus was exaggerating.102
Both men knew they had the Pope’s unquestioned backing. Marcinkus’s showy display confirmed to Sindona that the path to business at the IOR was now through the bishop. As for Sindona, he hoped that Marcinkus might stumble and make a mistake that could shake Paul VI’s faith in him. But instead of making an error that sidelined his career, events unrelated to the Vatican Bank boosted the Pope’s confidence in him. When Nixon came to the Vatican in 1969, tens of thousands of students protesting the Vietnam War rioted in Rome’s streets.IV Marcinkus personally took control of security arrangements for the church, directing Nixon’s helicopter to land in St. Peter’s Square. He then stood down the Secret Service in a tense argument and barred them from a private meeting with the Pope, at which Marcinkus was the translator. As the police battled huge running crowds, the President and the Pope met. A couple of months later Marcinkus used a body block to free the seventy-one-year-old Pontiff from a crowd that besieged him in Switzerland.104 In July, Marcinkus played a key role on a trip to Nigeria where the Pope tried in vain to promote a peace conference between the Nigerians and the secessionist state of Biafra.105 The following year, he helped get the Pope to safety in Sardinia when a left-wing mob stoned the motorcade, as well as at Castel Gandolfo when a heckler just missed the Pope’s head with a brick.
In a visit to the Philippines, a man wielding a butcher knife jumped out from a Manila crowd and lunged at the Pontiff.106 Marcinkus’s quick reaction proved a Boston Globe article from the previous year correct that his unofficial role on foreign trips was to be “a one-man squad of bodyguards.”107 Paul VI gave him a special commendation when they returned to Rome. In the Curia some now dubbed him il gorilla (he disliked that nickname because, “A gorilla at home in the States is like . . . a hood”).108
Leading prelates in the Curia knew that Marcinkus provided far more than just good security and planning. The Pope had come to completely trust his instincts and judgment. In 1971 the Pope elevated Marcinkus to president at the IOR to more accurately reflect his full authority there.109
• • •
In February, Roberto Calvi was promoted to general manager at the Ambrosiano, the bank’s third-ranking position. When the CEO retired that December, Calvi became its consigliere delegato, its president. With Sindona’s help, he set about to transform the sleepy Ambrosiano into an international merchant financial institution that traded stocks, invested in real estate, and even took stakes in private companies. To bypass restrictive Italian banking laws that limited the permissible scope of activities for a bank, Sindona had shown Calvi how to establish a web of holding companies in offshore banking havens such as Luxembourg, the Bahamas, Panama, and Costa Rica. Those jurisdictions prided themselves on the strictest client secrecy, allowing local attorneys and bankers to serve as proxies so that the true ownership of companies and banks was hidden from Italian tax authorities. On March 23, 1971, Calvi used Compendium, a Luxembourg holding company that he later renamed Banco Ambrosiano Holding, to register the Cisalpine Overseas Bank in Nassau, Bahamas.110 It was impossible on paper to track it back to the Ambrosiano, much less to discover that the Vatican Bank and Sindona held minority shares (the bank was capitalized for just $2.5 million, but in a few months would boast about $100 million in equity, most of it redirected Ambrosiano deposits, and $16.5 million in Swiss francs and German marks from the IOR).111 The maze of offshore holding companies was so effective in hiding the real owners that an official from Italy’s central bank would later admit they only found out the details of the Ambrosiano’s Bahamian operations when “we . . . read it in the newspapers.”112
A huge unregulated business dubbed the Eurocurrency Market had boomed in the island nation. It was a $65 billion industry in funds loaned by U.S. and European banks outside their country of origin.113 The banks avoided domestic disclosure about the details of loans, and in some cases, such as British banks, they avoided a tax on earnings connected to interest on the loans. It would take a decade before British and U.S. authorities managed to close most of the Eurocurrency loopholes. But in 1971, when Calvi first visited the Bahamas with a handful of other Ambrosiano executives, it was an ideal place to establish the bank’s most distant offshore subsidiary.
Calvi asked Marcinkus to become a member of the Bahamian bank’s board of directors. Sindona had told Calvi it was a good idea because wherever “I put him in . . . it helps me get money.”114 The bishop accepted. On August 5, 1971, a letter from Cisalpine informed the Bahamian registry of companies that a “Mr. Paul C. Marcinkus” was a new director. “The Most Reverend” was left off. Nogara’s unofficial rule had been that only IOR laymen or Black Nobles should join the boards of companies into which the Vatican invested. Nogara thought it would be untoward to have one of the cardinals from the oversight committee serve as a corporate director. The clerical garb carried too great a symbolic moral approval from the church. But there was no Nogara to persuade Marcinkus that it was a bad idea. Instead, when Calvi asked him, Marcinkus thought, “Why not?”115 As a director of Ambrosiano’s Bahamian branch, he was the first bishop in church history to serve on any board of any bank.V
Sindona suggested Pierre Siegenthaler, a Swiss thirty-four-year-old world-class yachtsman who also had some New York banking experience, become Cisalpine’s managing director. Calvi agreed.117 Siegenthaler, with a penchant for Gucci shoes and oversized Rolexes, ran Cisalpine from his Nassau home.118 Calvi liked the Bahamas so much that he bought a villa in a new luxury development in Lyford Cay. When Calvi and his wife, Clara, and their two teenage children spent their first holiday there that year, Marcinkus joined them.119 When Clara saw Marcinkus, she recalled that “he threw his arms around me and sang ‘Arrivederci Roma.’ ”120 The men spent the holiday discussing their bold new ventures while tuna fishing.121
In the following months, Calvi used his Luxembourg holding company Compendium to establish more offshore banks, not only in traditional European havens such as Luxembourg, Switzerland, and Liechtenstein, but also in less savory asylums like Panama, Nicaragua, and Peru. Calvi formed so many shell companies in Panama that he soon ran out of people to name as directors, resorting on the last one to naming the Ambrosiano’s switchboard operator.122
Calvi soon had a new deal to pitch to Marcinkus. He wanted the IOR to help the Ambrosiano move large sums out of Italy, in excess of what was permitted by Italian currency regulations. To help disguise the money moves, Calvi proposed conto deposito, so-called back-to-back operations in which the Ambrosiano would make deposits with the IOR, who would then pass the money to Cisalpine and other Calvi-controlled offshore companies. For Italian banking regulators, it would appear that the Ambrosiano’s money was merely parked at the IOR, when it had actually been moved to little-regulated foreign shells. At times, the IOR could direct the money to companies that needed it temporarily to boost their balance sheets. For its role, the IOR would earn one quarter of one percent of all the money that passed through it (that was later reduced to one sixteenth).123 Marcinkus thought it sounded like easy profits. By the end of December, the IOR had opened a $37 million five-year Cisalpine certificate of deposit, at an above-market rate of 8.5 percent interest.124
At the Vatican Bank, Mennini was one of the few who knew about Marcinkus’s decision to join Cisalpine’s board. He did not think it wise for the IOR to become further entwined in offshore deals. But Marcinkus dismissed him as well intentioned but old-fashioned. The IOR had to adapt to new and more sophisticated times. “You can’t run the church on Hail Marys,” he said.125
* * *
I. Thirty-five years later, in the middle of an unfolding scandal, Marcinkus claimed somewhat disingenuously to a Chicago Tribune reporter, “I can assure you that a career here [at the Vatican] wasn’t what I wanted. All I ever really wanted was to be a parish priest. But at my ordination, when I promised to obey, I felt that what happened to me after that was in my superiors’ hands. I’ve never asked for a specific task, but I’ve also never refused a job that was given to me. I guess you’d call me a team player. I play whatever position the coach puts me in.”10
II. Time noted that Marcinkus’s annual salary was $6,000, “about a teller’s salary in a New York City bank.” As for the value of the church’s stocks under his control, Time estimated the value between $10 billion and $15 billion ($94 billion and $153 billion in 2014 dollars).90
III. Fifteen years later, when embroiled in a great scandal, Marcinkus told author John Cornwell just the opposite: “I said four times, ‘You must be out of your minds!’ I said, ‘Why don’t you get somebody else? I have no experience in banking!’ And they said, ‘You have to kind of watch over things.’ I said, ‘I’m incompetent for that!’ That’s the way they do things around here!” He told Il Sabato, the Catholic weekly, “I have never been a businessman. I would not know where to begin.” But Marcinkus said he felt he had no choice but to accept the posting. “I’ve never asked for a job and I’ve never refused one. I don’t believe I have a right to refuse.”
“He’s never ever technically run the bank,” claimed his private secretary, Vittoria Marigonda. “The bank has been run by Luigi Mennini for nearly forty years.”101
IV. The riots that greeted Nixon were just another sign to the members of the P2 Masonic lodge that Italy was under siege by militant le
ftists. In April, Milan’s main railway station was bombed. In August, explosions hit several trains. Just before the 1969 Christmas holidays, bombs exploded at the National Bank of Agriculture in Rome’s Piazza Fontana, the National Bank of Labor, and a national monument to King Victor Emmanuel II. Seventeen innocent bystanders were killed and nearly one hundred maimed. The following month marked the formation of the Red Brigades, a radical Marxist group whose goal was the violent overthrow of the government. Sindona and many other P2 members considered themselves the last line between order and chaos. The turn to violence, coupled with a rapidly declining lira, brought the IOR a new flood of rich Italians seeking a safe haven. As for the Piazza Fontana bombings, police thought they were the work of leftists and anarchists. But eventually investigators believed right-wing fanatics were responsible. In 1995, after twenty-six years of multiple arrests, indictments, trials, and appeals, the police and prosecutors admitted defeat. No one was ever convicted of the bombings. Conspiracy theories about it are as popular in Italy as JFK assassination theories are in the United States.103
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