The Risk of Reforming God’s Bank

By Mark Esposito, Weekend Guy

Logo_IOROvershadowed by Pope Francis’ announcement Thursday that the mob is now persona non grata in Roman Catholic Churches (“RCC”) throughout the world is the very real –and related –struggle behind the scenes at the Vatican Bank. Officially known as the Istituto per le Opere di Religione or Institute for the Works of Religion, the bank has been at the center of RCC-Mafia relations for years. The bank itself is ostensibly independent but situates itself squarely on sovereign territory owned and controlled by the Pope and its Board of Superintendence answers directly to the Curia and the Pope.

Founded in 1942 by papal decree, the bank has had a tumultuous history. Unlike other financial institutions, the assets of the bank are not loaned to borrowers who pay back with interest. Rather the bank functions more like a holding company for assets which are intended to be distributed for charitable functions of the RCC. In this role as repository for the billions of dollars in assets and cash, the bank has been subjected to considerable criticism both for its haphazard administration and the customer it attracts. Customers, who Italian prosecutors say, have ties to organized crime. In 1987 the head of the bank, Archbishop Paul Marcinkus, was indicted by an Italian court for his part in the collapse of the Banco Ambrosiano. Marcinkus was charged in a bank fraud scheme to bilk  investors by issuing “letters patronage” on behalf of the Vatican Bank in support of Banco Ambrosiano. (Marcinkus was also named as

Paul Casimir Marcinkus
Paul Casimir Marcinkus

a possible accomplice in the supposed murder of Pope John Paul I by investigative journalist David Yallop in his book In God’s Name.) He was however revered in Vatican circles for his actions in thwarting an assassination attempt on Pope John Paul II. Millions in assets were lost in reliance on the “letters of patronage” and Marcinkus, with the Pope’s approval, hid in the Vatican until political pressure led to rescinding the arrest warrant. He then escaped to the United States.

Some have charged that Banco Ambrosiano was a piggy bank for the Italian mob and there’s considerable support for the proposition. Ambrosiano’s chairman, financier Roberto Calvi, also escaped criminal charges by fleeing to London under a false passport. Known in Europe as “God’s Banker,” Calvi had close ties to Marcinkus and the Holy See. He didn’t escape his victims however as London Bobbies was found him hanging under the Blackfriars Bridge  in 1982 shortly after the scandal broke. Mob informer, Francesco Marino Mannoia, claimed that Roberto Calvi had been killed because he had lost Mafia funds when Banco Ambrosiano collapsed. In July 2003, Italian prosecutors concluded that the Mafia was the culprit and acted not only in its own interests, but also to ensure that Calvi could not blackmail “politico-institutional figures and [representatives] of freemasonry, the P2 lodge, and the Institute of Religious Works with whom he had invested substantial sums of money, some of it from the Italian mob and Italian public corporations.” Keep those words “Italian public corporations” in mind.

To add further intrigue, Pope John Paul I was found dead shortly after commissioning a group of cardinals to investigate and reform the Vatican Bank. His official cause of death is natural causes but some authors have suggested that poison was the real culprit. The truth is likely found in the next world but the Vatican Bank’s link to Italian organized crime is hard to argue with in this one.

Calvi is not the only intersection between the Mafia and the Vatican Bank. In September 2010, Italian magistrates seized €23 million from the Vatican Bank, on the grounds that Italian anti-money laundering laws  had been violated. The money was originally to be transferred from the Italian Credito Artigiano to JP Morgan Chase and another Italian bank, Banca del Fucino. The origin and destination of the funds were accounts under the control of the Vatican Bank. That’s classic turning dirty money into clean money.  Bank officer Gotti Tedeschi and another Vatican bank manager were under investigation for money laundering charges. The account holders were reputedly affiliated with the Mafia.”The Holy See is perplexed and astonished by the initiatives of the Rome prosecutors, considering the data necessary is already available at the Bank of Italy,” a Vatican statement read.


On June 5, 2012, Tedeschi’s home in Piacenza Italy was raided along with his two offices in Milan.This was as part of a corruption probe into Giuseppe Orsi. Orsi is CEO and chairman of Finmeccanica S.p.A,a leading industrial group in the high technology sector in Italy and one of the main global players in aerospace, defense and security. It is partially owned by the Italian government making it … you guessed it … an “Italian public corporation.”  Orsi has been indicted for bribery and corruption in connection with the sale of helicopters to India. Prosecutors allege that bribery was part of the `’company philosophy,” according the Italian news agencies that obtained copies of the arrest warrant. Finmeccanica S.p.A’s  previous chairman and CEO, Pier Francesco Guarguaglini, was also implicated in the bribery investigation. Guarguaglini and his wife, who ran a subsidiary, are accused of setting up slush funds to funnel money to political parties to gain favor.

In Italy, some political parties are closely aligned with mob money and influence. They even are charged with lobbying for the Mafia’s interests in Italy’s parliament. To keep that job, politicians had better be effective: “In 1992 the mafia assassinated Salvo Lima a prominent Sicilian DC politician who, allegedly, had been one of the key figures in representing mafia interests in Rome. What was happening? As Alexander Stille put it:

“Even for a country all too used to political killings, the Lima assassination was deeply shocking. Dozens of politicians and prosecutors had been murdered by the mafia over the previous fifteen years, but—with the exception perhaps of General dalla Chiesa—Lima was the most prominent victim. Moreover the others had been outspoken enemies of the mafia. Lima, instead, was considered to be one of its closes friends in power… his murder was a profound embarrassment to the Christian Democratic Party. Given Lima’s close ties to Andreotti, it was as though the mafia had dumped a dead body on the prime minister’s doorstep as a sinister warning.”

The warning was that the Mafia had perceived that its ‘friends in high places’ were not serving its interests effectively and they had better do so.” (

In July 2012, “Italian prosecutors arrested a priest who worked as a financial analyst for the Vatican, accusing him of trying to help smuggle tens of millions of euros across Europe using a private plane. That same month, two top officials at the Vatican Bank resigned, as Italian prosecutors continued their three-year investigation into the bank,” according to CNN.

Against this backdrop comes newly elevated Pope Francis. Tall, handsome, and armed with popular support from within and outside the church, he has taken up the mantle of Pope John I and instituted his own reform of the Vatican Bank. In June 2013, Pope Francis, authorized the Cardinals’ Commission to appoint Monsignor Battista Mario Salvatore Ricca as the Bank’s Prelate ad interim. Charged with reforming and making the bank transparent, Ricca was immediately made the subject of a whisper campaign that accused him of consensual homosexual acts while serving at the Vatican. There were also allegations that some anti-reformers in the Curia had threatened to blackmail Ricca with other scandalous accusations if he persisted in his efforts at reform. Ricca did offer to resign but it was flatly rejected by Francis who seems committed to seeing the reform through.

Just two weeks into Ricca’s tenure, Monsignore Nunzio Scarano, previously senior accountant at APSA, the Vatican’s Administration of the Patrimony of the Apostolic See was indicted with corruption charges.  On  January 21, 2014, those charges were expanded to money laundering through Vatican Bank accounts in yet another investigation. The charges stem from plans to smuggle €20 million in cash from Switzerland into Italy via the Vatican Bank.

So, Pope Francis and his emissary Monsignore Ricca have a wolf by the ears as the ancient Roman Seneca might say. Unable to release the Vatican Bank due to its repository of treasures and unable to hold it due to its ties to organized crime and corruption, it’s as tricky a political thicket as they come and it may hide a lethal enemy in the form of the Italian Mafia. “The strong will of Pope Francis, aiming to disrupt the gangrene power centers, puts him at risk. He disturbs the mafia very much,” Nicola Gratteri, a top anti-mafia prosecutor in Italy, told CNN on Thursday.

Were I Pope Francis and facing this assortment of enemies both within and outside the church, I’d be taking a page from the Roman emperors and hiring an official food taster.

Source: CNN

~Mark Esposito, Weekend Contributor

22 thoughts on “The Risk of Reforming God’s Bank”

  1. Does this bank participate in usury?
    At one point in time usury was considered a mortal sin and would be denied last rites and a christian burial.

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