God's Banker

by Rupert Cornwell

  The slant of the P-2 was broadly anti-Communist and right-wing. Attempted coups, more or less serious, were more than one between 1960 and 1975 in Italy, and several of those said to have been involved were to feature in Gelli's motley army. There are numerous pointers too that the P-2 may have had a hand in right-wing terrorist outrages dotting recent Italian history, from the so-called "strategy of tension" which emerged in the late 1960s to the Bologna station bombing of August 1980. The aim, presumably, to soften up public opinion for takeover by a more authoritarian regime. But it is not certain that Gelli himself seriously entertained such designs; the tenuous struc­ture of the P-2 would have militated against them in any case. Equally possibly, the grandmaster's business was power, whose man­ipulation became an end in itself. Gelli and Ortolani gave the lodge Latin American dimensions, and entry to regimes there broadly sharing their own philosophies. Sindona was to contribute the wealth of his Italo-American contacts, and Calvi, quite simply, money.

  By the end the lodge had been identified as a clearing house for almost every scandal to have shaken Italy in the last fifteen years. In that sense, at least, Gelli was the ideal destabilizer, beloved of secret services everywhere. But his greatest skill was the accumulation of information. As an excellent biographer has written: "It certainly hasn't been Gelli who invented intrigue and conspiracy (in Italian public life). His contribution to Italy's progressive degradation is different. Gelli increased the level of national corruption. He per­fected and made widespread the use of the photocopy and the spool of tape. The exploitation of secret documents and tape recordings of private conversations have now become almost daily weapons in the political struggle."*

  Possession of such material was the cement of his power over his acolytes, and his ability to blackmail them if necessary. In this skill Gelli was undeniably brilliant—even if the lingering mediocrity of the man has made many believe (not least for their self-respect) that the truly guiding hand behind the P-2 must have belonged to another. For Gelli was marketing illusions. The main appeal to the bulk of the members of his lodge was the apparent short cut it offered to powers, riches and the best jobs; and for such an advantage, surrender of secret information to the grandmaster must have seemed a reason­able price to pay.

  In that sense, the P-2 was simply an extreme manifestation of the basic instinct of every Italian. In a land where the state is rarely powerful, neutral or efficient, the safest means of personal advance­ment are recommendation and knowing the right people. The other side of this coin is gullibility, a quality which Calvi also possessed. For so ardent a believer in the merits of the back door, the P-2 was a perfect means of discreet access to the inner circuits of power.

  Then there was Ortolani, and his Vatican connections. For the blood of the Milanese Curia ran in the veins of Ambrosiano, and its backing was something he could not afford to lose. Later Ortolani and his family seem to have grown into some of the few personal friends that Calvi could claim; but in professional terms Ortolani was to constitute the perfect bridge between the two historically rival bodies with whom Calvi allied himself, the Church and freemasonry.

  Thus the way ahead looked clear and Calvi the pupil was over the years between 1969 and 1974 to develop gradually into Sindona's peer and then his natural successor. At the beginning of 1971, Calvi earned

  *Gianfranco Piazzesi: Gelli, Garzanti, 1983.

  the key promotion to the rank of direttore generate, or general manager. His power in his bank would soon be complete. Carlo Canesi had already decided to step down as chairman at the end of 1971. For a while, disturbed at the involvement of Calvi with Sin­dona's increasingly controversial ventures, Canesi is said to have toyed with the idea of bringing in an outsider as Ambrosiano's new chairman. But Calvi had by now made himself indispensable.

  In the end a compromise emerged. Ruggiero Mozzana, already 69, would succeed Canesi, while Calvi would take on the additional duties of amministratore delegato, or managing director. Although he was not to move into the chairman's office until 1975, the reins of power were in effect already his.

  Upon his appointment as general manager, Calvi had wasted no time in putting his plans into effect. The Americas beckoned, and like Christopher Columbus in 1492, his first landfall in the new world was the Bahamas. The explorer had come ashore at the island of Salva­dor. Calvi's goal, however, was Nassau, by then one of the hottest offshore centres in international banking—and, equally important, governed by a code of banking secrecy to rival that of Switzerland. A subsidiary in the Bahamas, therefore, would not only fit in with Calvi's preferred image as an internationally-minded banker, deter­mined to broaden Ambrosiano it would also later permit him to conduct his most sensitive business safe from the prying eyes of the Italian monetary authorities.

  Calvi, at the head of a small group of foreign department execu­tives from Ambrosiano, arrived for the first time in Nassau from the chilly Milanese winter in January 1971. Sindona later claimed the idea was his, but scores of international banks, most of them American, were already established there; if only, in many cases, with a shiny nameplate and a couple of secretaries minding the telex machine. The offshore, or Eurodollar, market was booming and Nassau, with its agreeable climate, tempting banking legislation and common time zone with New York, was an ideal centre for booking such transac­tions.

  The face of the city's old colonial centre was changing. Queen Victoria's statue still guarded Parliament Square, but along Bay Street the vibrant calypso clubs were giving way to glossy, hushed new bank premises. The Caribbean evidently suited Calvi, but it made little impact on his polite but distant demeanour. "He was terrible formal and austere, just not what you imagine an Italian to be like," someone who met him personally on that first visit would remember. The judgement was apt; years before in Milan some who knew the rising young banker had dubbed Calvi the "Prussian" for his remote efficiency.

  Within two months Ambrosiano's beachhead in the new world, the Cisalpine bank of Nassau, was duly registered, and opened for business the following May. As its manager, Calvi chose a Swiss-born expatriate newly arrived from New York called Pierre Siegenthaler. In his early 30s, Siegenthaler was an Olympic-class yachtsman with some banking experience in the US, and some accounts have it that he was recommended to Calvi by Sindona. Siegenthaler had a taste for Gucci shoes and gold watches (but a habit in the early days of bicycling to work in a pair of jeans). In fact, though, he was to be the discreet executor of many of Calvi's most private schemes in the decade ahead.

  The new bank was capitalized at $2.5 million, and initially operated from Siegenthaler's home. But that did not prevent it attracting over $200 million of deposits, largely from elsewhere within the Ambro­siano group, in a very short time. Calvi in the meantime was making other arrangements for a long stay. Early on he rented a villa for his regular winter visits to the Bahamas, but before long he had secured a residence at the exclusive Lyford Cay complex on the western tip of New Providence island, from which unauthorized visitors were bar­red by a private police force.

  A founding shareholder of the Cisalpine Overseas bank was the IOR, the Vatican bank. And one of the early visitors to the rented villa, joking with Calvi and his wife and discussing water-skiing with his two teenage children was the IOR's new chairman and, since August 5 1971, a director of Ambrosiano's subsidiary in Nassau— Archbishop Paul Marcinkus.

  CHAPTER FIVE Vatican

  The initial and enduring impact of Marcinkus is physical. To talk to, he can be expansive or peremptory, charming—but occasionally brutal. But what lingers in the mind is the sheer bulk of the man, six foot three in his socks and built like the natural athlete he is. The impression is curiously heightened by the slight stoop he has now acquired—to which the weight of the Banco Ambrosiano scandal has undoubtedly contributed. In the days when he guarded Popes on their foreign travels, he would seem affable, wisecracking but vaguely menacing; a streetwise, sharp-eyed American who by accident had found himself in the
closeted, insulated world of the Vatican. His recreations today, tennis and above all golf, are those of the self- made American business executive. His swing—at least in the days before notoriety prevented him getting out on to the course for a round—had something of the style of the late Tony Lema, "Cham­pagne Tony", who won the British Open in 1962, and whom Mar­cinkus would remember with affection.

  Yet this incongruous man of the Church, in some ways the most important figure in this story after Calvi himself, won the confidence of two Popes, Paul VI and the Polish-born John Paul II.

  His origins were far more modest than those of Calvi. Paul Casimir Marcinkus was born on January 15 1922 in the tough Chicago suburb of Cicero, one of five children of Mykolas Marcinkus, an emigrant from Lithuania who found work as a window-cleaner. His early years were those of prohibition and gang wars. A1 Capone was one of the city's more noted products of that era.

  But at the Roman Catholic grammar school of St Anthony's, Marcinkus was a brighter-than-average pupil, and, of course, sports- mad. It was a complete surprise to his classmates when he decided to study for the priesthood. In 1947 he was ordained, and three years later he left for Rome to study canon law at the city's Gregorian University. His intention was to return to Chicago, but in his own words, "I just got trapped."* A temporary summer stint at the Vatican's secretariat of State so impressed his superiors that he was taken on permanently.

  His drive, and ability to get things done soon won him an important admirer, Monsignor Giovanni Battista Montini, a high Curia official who would be appointed Cardinal Archbishop of Milan in 1954. Nine years later Montini returned to Rome, as Pope Paul VI. Marcinkus, in the meantime, was to serve as a Vatican diplomat in Bolivia and Canada, but it was his managerial and administrative prowess which really attracted attention. He also had the talent of being the right man in the right place. Paul VI was the first Pope to travel the world, but his first trip, to Jerusalem in 1964, proved so badly organized that in future he enlisted the services of Marcinkus—first as St Peter's own American-style advance man, and then as unofficial bodyguard and aide. In 1965 Marcinkus acted as interpreter when Pope Paul met President Lyndon Johnson in New York. In the Philippines in 1970 he helped save the Pope from attack by a knife-wielding Bolivian artist.

  Then again, in the late 1960s, when deposits from US Catholic institutions with the IOR began to fall off, what better choice could Paul VI make to head the bank than a dynamic American prelate and proven manager, who originated from the largest US archdiocese?

  Inevitably the swift rise of this foreign intruder with his no- nonsense ways aroused some resentment and jealousy within the Italian-dominated Curia. But America loves a success story; and some who crossed the Atlantic on Church business are said to have regarded a round of golf with Marcinkus at the Acqua Santa golf club down on the Appian way as a status symbol to match an audience with the Pope himself.

  Such different views, of course, sharpened later, first with the Sindona scandal, and then the Ambrosiano affair. Americans who knew Marcinkus well were generally prepared to forgive him. He might have been gullible, they maintained, but at heart he was a "nice

  *Chicago Tribune, March 13 1983.

  guy", basically honest, loyal and good company, always ready to put himself out for a friend. From the other side of the cultural divide, many Italians who had to deal with him could find Marcinkus rude and abrupt. Some found it quite plausible that he was the Vatican end of a conspiracy stretching from Calvi, Sindona and the P-2 to the CIA and the Mafia.

  Sindona himself has claimed that he had a hand in Marcinkus' appointment to the IOR, nor would that be surprising. Both were friends of Continental Illinois' David Kennedy, head of the biggest bank in the archbishop's home town of Chicago. The Sicilian was already helping the APSA dispose of its embarrassing holdings in Italian industry; while Paul VI had had reason in his Milan days to be grateful to Sindona for helping the success of Church-backed char­ities. In any event, Marcinkus was first named manager and then, in 1971, chairman of the Vatican Bank.

  The enterprising archbishop thus became the latest embodiment of a dilemma which in varying degrees has haunted the Church since it ceased to be a temporal power in Italy in the nineteenth century. How was it to reconcile its rejection of crude liberal capitalism (a hundred years ago at its height) with the practical need of working with that system, to raise money to finance its mission?

  Back in 1860 devout Catholics attempted to resolve the difficulties by instigating the device of "St Peter's Pence", individual contribu­tions from the faithful donated each year to the person of the Pope. Catholic financiers rallied round, too, providing loans and other ingenious fund-raising proposals. One of them was a certain Andre Langrand-Dumonceau, who first earned the nickname of "Europe's financial Napoleon", only to go spectacularly bankrupt in 1870. A recent study* has observed that he was "the extreme example of a strategy worked out by Catholic financiers, French and Belgian in particular. They aimed to involve the Holy See in their business deals, thus profiting from the moral and economic good name of the entire Catholic Church." Something of the same could be said for the relations of Sindona, and then Calvi, with the IOR. But Marcinkus seems to have been unmindful of the precedents.

  *Carlo Crocella, Augusta Miseria, Nuovo Istituto Editoriale Italiano 1982.

  When he took over the IOR he already inherited some links with Sindona, notably the holding in Banca Privata Finanziaria. But the two, who got on splendidly, rapidly extended their collaboration. Sindona is fond of claiming today that he saved the Vatican from financial disaster by relieving it not only of SGI, but two other companies as well. One was Condotte d'Acqua (later to pass to IRI, the giant Italian state industrial conglomerate); the other was Ceramica Pozzi, a badly run manufacturer of, among other things, lava­tories. In return the IOR bought into various Sindona enterprises, both in Italy and outside. Marcinkus, with his lack of financial training, was no banker. Indeed, it has been maliciously observed that his troubles began when he started to regard himself as one. The real expertise belonged to Luigi Mennini, the IOR's managing director, a rarely-seen figure with a lifetime's experience in the Vatican bank—and of the ways of Catholic Italian finance.

  Just how and when Paul Marcinkus and Roberto Calvi met is not clear. Marcinkus has declared that he was put on to Calvi by the Milanese Curia; Sindona has asserted that he was responsible. But the fateful meeting must have happened in 1971 at the latest. For by the August of that year, as we have seen, Marcinkus was seated on the board of Calvi's Cisalpine Bank in Nassau. The moment marks the start of IOR's hidden association with Ambrosiano. The Vatican bank took an early shareholding of Cisalpine of two and a half per cent, later to rise to eight percent. Nobody noticed, or paid attention to, the fact that Marcinkus was one of its directors. But then nobody was paying much attention to Calvi in those days.

  The archbishop has since stated that he saw Calvi only two or three times a year, "to discuss ideas and arrangements". He maintains that apart from that first stay in Nassau, he hardly met the banker socially, although Calvi's family dispute this. What is true is that Marcinkus was an ever busier man, and that day-to-day dealings between Ambrosiano and the IOR were left to Mennini and his equally retiring deputy, Pellegrino de Stroebel, chief accountant of the IOR.

  The personal relationship between the gregarious, direct Mar­cinkus and the diffident and elusive Calvi is not easy to visualize. Professionally, however, Calvi had much to recommend him. His bank had three-quarters of a century of links with the Catholic Church in Milan, his discretion was absolute, and his financial skills considerable. However mixed the feelings in the Vatican over the rough and tumble of international finance, it needed to increase its income—and the IOR was an obvious means to this end.

  Of all the mysteries of the Eternal Church, few are greater than that of its finances. The sheer geographical extent of the institution is part of the difficulty, but a bigger reason is the Vatican's obsessive secre
cy. Clearly its possessions are huge, in terms of land, art and property. But Michelangelo's Pieta cannot be sold off to balance a budget. Like any other state, the Vatican must try to match income to expenditure. But as rising government deficits around the world were there to prove, that task became from the mid-1960s steadily harder. Inflation was rising, and salary increases, not just for the Curia's staff but also the 1,400 predominantly lay workers who enable the Vatican to be administered, had to keep pace. Extended international travel by the Pope, new departments set up after the Second Vatican Council in 1962, more forceful diplomacy and a new sense of international mission, all cost money. To meet these outgoings, and cover a declared budget deficit which by 1980 had reached $25 million, the Vatican must have been forced to rely increasingly on its two sources of undeclared income: St Peter's Pence and the earnings of the IOR. Under Paul VI, however, the former were unable to keep up with the growing demands. It is held that the proceeds of St Peter's Pence fluctuate with the popular appeal of individual Popes. In the reign of John XXIII, with his earthy warmth, they had soared.* But his more detached, introspective successor, especially in the later years of his Papacy, was a less compelling figure. Income, it is said, stagnated. So that left the IOR.

  The Institute for Religious Works had been created by personal decree of Pius XII in June 1942, when the war was causing extra problems for the Vatican's financial workings. Its stated purpose was, and is, to manage assets entrusted to it—cash, shares and property— in the interests of the world-wide Church. Completely independent of the APSA and the Prefecture for Economic Affairs of the Holy See

  *Only now, with the global appeal of John Paul II, has the trend been reversed. Figures unprecedentedly released in November 1982 showed that in 1981, offerings of $24 million to the Pope, including $15.4 million of "St Peter's Pence", had helped the Vatican to show a general budget surplus of over $4 million. (in effect the Vatican's Finance Ministry), the IOR is theoretically supervised by a panel of five cardinals. In practice, however, Marcinkus had a free hand, reporting only to the Pope himself. Tradi­tionally the IOR has never given the smallest detail of its business, still less published a balance sheet, although that might change after the Calvi debacle. But as a bank it is medium-sized at best. Calvi would describe it as colossal to his few intimates; the more likely truth is that it administers funds of probably no more than $2 billion, half the size of Ambrosiano at its height. Its own assets may not exceed $150 million. The IOR's operations are now computerized. But its visible premises, including an ill-lit banking hall complete with clerical tellers, seem as dingy as the courtyard of Sixtus V, through which it is approached. Marcinkus' own office is more like a comfort­able smoke-filled study.