The Vatican Financial Empire- A Hidden History | 2024 Documentary
Summary
TLDRThe script explores the financial history of the Vatican, from the Renaissance to modern times, detailing scandals involving Roberto Calvi, Michele Sindona, and Archbishop Paul Marcinkus. It covers the Vatican's involvement in bank fraud, money laundering, and its struggle to maintain financial integrity amidst global crises and internal corruption.
Takeaways
- π¦ The Banco Ambrosiano scandal of 1982 involved Italian banker Roberto Calvi, who was connected to the Vatican and later found dead under suspicious circumstances in London.
- π The Vatican, as a significant religious and financial institution, has a long history of influence and involvement in various financial activities, including real estate and investments.
- πΈ The Church has occasionally engaged in morally ambiguous financial practices, such as selling indulgences during the Renaissance, which contributed to the Reformation led by Martin Luther.
- π The Vatican faced severe financial crises, including after the French Revolution and the rise of Napoleon, which led to Pope Pius VI's death in captivity.
- π€ In the 19th century, the Vatican sought financial help from the Rothschild family, establishing an unlikely alliance that helped the Church navigate through financial distress.
- π¦ The establishment of the Vatican Bank, or Istituto per le Opere di Religione (IOR), in 1942, allowed the Church to operate in secrecy without public disclosure of its financial activities.
- πΌ The Vatican Bank has been associated with controversial figures like Michele Sindona and Roberto Calvi, who were involved in financial scandals and criminal activities.
- π The collapse of Banco Ambrosiano and the subsequent scandals led to a significant financial and reputational crisis for the Vatican, affecting donations and the Church's operations.
- ποΈ Pope Francis, elected in 2013, has made strides towards transparency and ethical finance, publishing annual financial reports for the Vatican Bank and addressing the clergy sexual abuse crisis.
- π Despite past challenges and scandals, the Catholic Church continues to grow globally, with an increasing number of followers, particularly in Africa and Asia.
Q & A
Who was Roberto Calvi and why was he on the run in 1982?
-Roberto Calvi was an Italian banker who worked for Banco Ambrosiano, a bank closely associated with the Vatican. He became a fugitive in 1982 due to his involvement in a $790 million bank fraud scandal and was trying to escape legal consequences.
How was the Vatican involved in financial activities during the Renaissance?
-During the Renaissance, the Vatican was not only a significant political and religious entity but also a powerful financial institution. It relied on selling indulgences, a practice where the faithful paid for documents promising the remission of sins, to generate income and maintain its power.
What was the impact of Martin Luther's Reformation on the Catholic Church's finances?
-Martin Luther's Reformation was a major financial setback for the Catholic Church. The widespread abuses in selling indulgences became a rallying cry for the Reformation, which ultimately transformed the religious world and negatively affected the Church's financial strategies.
How did the Vatican's financial situation change after the French Revolution and the rise of Napoleon Bonaparte?
-The French Revolution and Napoleon's rise to power led to a severe financial catastrophe for the Vatican. French forces invaded Rome in 1798, ending papal rule and leading to Pope Pius VI's death in captivity, which nearly brought the Roman Catholic Church to an end.
Who were the Rothschilds and how did they help the Vatican financially in the 1830s?
-The Rothschilds were a banking dynasty that played a key role in international finance during the 19th century. When the Vatican was in a dire financial situation in the 1830s, it turned to the Rothschilds for help, and James de Rothschild became the official papal banker, lending the Vatican a significant amount of money.
What role did Bernardino Nogara play in the Vatican's financial recovery during the early 20th century?
-Bernardino Nogara was a devout Catholic with a strong financial expertise. He was chosen by Pope Pius XI to manage the funds that came from the Lateran Pax in 1929. Nogara's strategic investments and financial acumen helped the Church avoid financial collapse during the Great Depression.
How did the Vatican Bank (IOR) operate during World War II and what was its involvement with Nazi officials?
-During World War II, the Vatican Bank operated in secrecy and without transparency, which made it an ideal vehicle for hiding and laundering money. It is estimated that the Nazis, realizing they were losing the war, turned to the Vatican Bank to help move their stolen gold, which was possibly transferred onwards to South America.
What was the significance of Michele Sindona's involvement with the Vatican Bank?
-Michele Sindona was a financial hustler known for helping people evade taxes, a skill highly desired by the Vatican. His ability to quickly raise funds and manage financial operations made him a valuable asset to the Vatican Bank, although his involvement would later become one of the Church's worst mistakes.
What led to Roberto Calvi's downfall and eventual death?
-Roberto Calvi's financial schemes could not be sustained, and he faced mounting legal and financial pressures. His former partner, Michele Sindona, threatened and attempted to blackmail him, leading Calvi to divert substantial funds to Sindona under duress. Eventually, Calvi was found dead, hanging from Blackfriars Bridge in London, in what appeared to be a dramatic public execution.
How did the Vatican respond to the scandals involving Roberto Calvi and Michele Sindona?
-The Vatican publicly acknowledged that it was a mistake to work with Calvi but denied any involvement in his death. The Church agreed to pay $244 million in a legal settlement involving Banco Ambrosiano, and the public scandal led to a decrease in contributions from Catholics, resulting in a budget deficit for the Church.
What steps did Pope Benedict XVI take to address the clergy sexual abuse crisis and increase transparency within the Vatican Bank?
-Pope Benedict XVI took significant steps to address the clergy sexual abuse crisis by meeting with abuse victims and taking action against the abusers. He also made efforts to increase transparency and compliance within the Vatican Bank, particularly in response to the scandals and financial difficulties the Church was facing.
Outlines
π¦ The Downfall of Roberto Calvi and Banco Ambrosiano
Roberto Calvi, an Italian banker for Banco Ambrosiano, a bank with close Vatican ties, becomes a fugitive in 1982 due to a $790 million bank fraud scandal. After fleeing to London, his body is found hanging from Blackfriars Bridge, sparking numerous theories about his death. The paragraph also delves into the Vatican's significant financial and real estate holdings and its historical financial strategies, including the selling of indulgences during the Renaissance, which led to significant income but also contributed to the Reformation and a major financial setback for the Church.
π€ The Unlikely Alliance Between the Vatican and the Rothschilds
In the 1830s, the Vatican, facing a severe financial crisis, turns to the Rothschild Banking Dynasty for assistance. James de Rothschild becomes the official papal banker, providing a substantial loan that helps the Church to stay operational. The partnership leads to financial reforms and new ways for the Church to accumulate assets, including the selling of bonds to the Catholic faithful and investments in real estate and stocks, such as those of the Bank of Rome.
π‘ Vatican's Financial Strategies During War and Crisis
The Vatican's financial strategies during times of war and global crisis are highlighted, including its alliance with Germany during World War I, where it received covert funding labeled as Peter's Pence. Bernardino Nogara's role in managing the Vatican's finances is emphasized, especially during the Great Depression, where his investment strategies, such as buying gold and real estate, helped the Church avoid financial collapse.
π Vatican Bank's Expansion and Secret Operations in World War II
The establishment of the Vatican Bank, or Istituto per le Opere di Religione (IOR), in 1942 is detailed, along with its secretive operations during World War II. The bank's unique abilities, such as not disclosing financial statements and destroying files every decade, made it an ideal vehicle for hiding and laundering money. It is alleged that the Vatican Bank helped Nazis move stolen gold and assisted in the escape of high-ranking Nazis to South America.
π The Rise and Fall of Michele Sindona and the Vatican's Financial Growth
Michele Sindona's rise from a tax-evading lawyer to a banking tycoon with connections to the Vatican is chronicled. His rapid growth and the risks he took, including the purchase of Franklin National Bank, are discussed. Sindona's eventual downfall due to risky trades and the collapse of his empire are detailed, as well as the Vatican's continued financial growth under the leadership of Cardinal Paul Marcinkus.
ποΈ Pope Francis and the Transformation of the Vatican Bank
The election of Pope Francis and his progressive approach to the papacy are outlined. His efforts to increase transparency within the Vatican Bank and the positive effects on the Church's image are highlighted. The paragraph also notes the increase in donations to the Vatican Bank due to higher mass attendance and participation in Catholic charities under Pope Francis's leadership.
Mindmap
Keywords
π‘Banco Ambrosiano
π‘Roberto Calvi
π‘Vatican
π‘Indulgences
π‘Reformation
π‘Napoleon Bonaparte
π‘Rothschild Banking Dynasty
π‘Istituto per le Opere di Religione (IOR)
π‘Michele Sindona
π‘Archbishop Paul Marcinkus
π‘Pope Francis
Highlights
In 1982, Italian banker Roberto Calvi, associated with Banco Ambrosiano and the Vatican, was found dead under suspicious circumstances in London.
The Vatican's significant financial interests include the world's largest real estate collections and involvement in numerous corporations.
During the Renaissance, the Vatican capitalized on selling indulgences, contributing to its wealth but later sparking the Reformation.
The Vatican faced a severe financial crisis in the 18th century, which led to Pope Pius VI's death in captivity.
In the 1830s, the Vatican turned to the Rothschild family for financial support, marking the first time it borrowed from a Jewish banker.
The Vatican's financial strategy evolved to include Peter's Pence, selling bonds to the faithful, and investing in real estate and stocks.
The Vatican Bank, established in 1942, operated in secrecy without the need to disclose financial statements or activities.
The Vatican Bank was allegedly involved in laundering Nazi assets and aiding their escape to South America post-World War II.
Bernardino Nogara played a pivotal role in managing the Vatican's finances during the Great Depression, securing its financial stability.
The Vatican's financial dealings became a liability, leading to the downfall of key figures like Roberto Calvi and Michele Sindona.
The Vatican faced a public scandal and financial crisis following the Banco Ambrosiano collapse, affecting its credibility and donations.
Pope Francis introduced transparency and financial reforms in the Vatican Bank, publishing annual financial reports and increasing donations.
The Catholic Church's global population continues to grow, with an increase in Africa and Asia, shifting the geographic centers of the church.
The Vatican's history of engaging in capitalism has led to predatory practices that conflict with Catholic faith values.
Despite past financial crises and scandals, the Vatican remains a unique and powerful institution with a growing global Catholic population.
Transcripts
On a quiet night in 1982, Italian
banker Roberto Calvi is on the run.
He has spent a lifetime working for Banco
Ambrosiano, a bank whose
biggest customer is the Vatican.
But now he's a fugitive, desperately trying to
escape the long arm of the law.
An Italian smuggler arranged for him to be driven
overnight to Austria, where he shuttled
between several cities for a few days before
boarding a private charter in Innsbruck for
a flight to London.
After arriving in London, he
finally can catch his breath.
He has no idea what fate awaits him.
The body of a missing Italian financier, Roberto
Calvi, the central figure in a $790 million
bank fraud scandal, was found hanging from a London
bridge Friday, the police said today.
Mr. Calvi, dismissed as head of Italy's second
largest private bank, had been missing for
nine days.
The police said a stroller came across his body
early Friday, hanging from the scaffolding
of Blackfriars Bridge over the Thames River in the
heart of London's financial district.
For centuries, the Catholic Church has been a
monumental pillar of human history.
From the echoing halls of the Vatican to the
humblest of rural chapels, its influence has
permeated every corner of the globe.
But it is also a powerful financial institution,
with the world's largest real estate collections
and vested interests in a
vast number of corporations.
The Vatican owns more than 5,000 church and
investment properties around the world, a
central office at the Catholic Church revealed for
the first time Saturday, according to
several news outlets.
Well, I think every Catholic who reads a story like
this ends up caring, because in the end
they want to know where their money is going.
The Vatican's need to generate revenue, like any
large institution, has occasionally led
to decisions that some could
perceive as morally ambiguous.
It is the height of the Renaissance, and Italy is
the epicenter of this movement, with
major contributions in painting, sculpture,
literature, and architecture.
Around this time, the Vatican is a powerful entity
in Europe, exerting considerable political
power, influencing rulers, and governing a
substantial territory in central Italy known
as the Papal States.
To maintain its power, the Vatican needs an
ever-growing source of income.
It relies on a brilliant strategy to take Vatican
finances to the next level.
Selling Indulgences
The Church found the money it needed in the selling
of so-called indulgences, a sixth
century invention whereby the faithful paid for a
piece of paper that promised that God
would forego any earthly
punishment for the buyer's sins.
The Vatican set prices according to the severity of
the sin, and they were initially available
only to those who made a pilgrimage to Rome.
This strategy has brought significant income to the
Vatican, causing its assets to skyrocket.
But what the Church doesn't realize is that this
strategy for generating extra income
is quickly getting out of control.
The licentious lifestyle of the Papal Court and the
widespread abuses in selling indulgences
became a rallying cry for
Martin Luther and the Reformation.
Ultimately, Martin Luther's
Reformation transforms the religious world.
And for the Catholic Church, it also
represents a major financial setback.
But approaching the end of the 18th century, the
Vatican will suffer an even worse financial
catastrophe.
In 1789, a crisis is brewing in France.
After decades of growing anger with the government,
a revolution erupts, culminating in the overthrow
of the monarchy and the
establishment of a republic.
Europe is thrown into chaos once again.
But one man uses this chaos as a ladder, Napoleon
Bonaparte, who rises to power in the aftermath
of the revolution.
He immediately sees the
advantage of controlling the papacy.
By 1798, French forces have invaded Rome itself,
proclaiming a Roman republic and effectively
ending papal rule over the city.
Pope Pius VI dies on August 29, 1799, in Valence,
France, still in French captivity.
The fall of the Vatican and the subsequent death of
Pope Pius VI nearly bring the Roman
Catholic Church to an end.
In the 1830s, after the upheaval of the Napoleonic
Wars and the Congress of Vienna in 1815, the
papal states are restored to papal control.
But the Vatican is in a dire financial situation.
Desperate for enough funding to remain operational,
the Church reaches out to an unlikely financier,
the Rothschilds.
In the 1830s, the Rothschild Banking Dynasty
established itself as a key player in international
finance.
By stationing its members across key European
cities, Frankfurt, London, Paris, Vienna,
and Naples, the Rothschilds were extensively
involved in government finance, issuing bonds
and lending money to states, especially during
times of distress when higher interest rates
could be charged.
And at the time, there is one powerful entity in
Europe in such financial distress.
In 1831, Gregory XVI became pope.
He knows the Vatican might not survive long unless
there is an immediate cash infusion.
For the first time in the Church's history, the
Vatican decides to borrow money from the
most prominent Jewish banker.
James de Rothschild, head of the family's
Paris-based headquarters, becomes the official
papal banker.
One of his brothers, Carl, who runs the family's
Naples branch, begins traveling to Rome to
consult with the pope.
Their financial empire prompted a mixture of envy
and resentment among Church officials.
Most traditionalists, who referred to James as the
leader of international Jew-ry, were
appalled that the Church had resorted to Christ
killers for financial succor.
French poet Alfred de Vigny wrote that "a Jew now
reigns over the pope and Christianity.
He pays monarchs and buys nations."
The Rothschilds lend the Vatican 40 million euros in today's money.
It becomes a lifeline that
the Church desperately needs.
The unlikely alliance is forged, and with the
Rothschilds' influence, the Church begins
a series of financial reforms, which mean more ways
for the Church to accumulate assets.
Historically, the Vatican collected money through
what is called Peter's Pence.
It dates back to at least the 8th century, and it
has its roots in England, where Anglo-Saxon
kings collected annual tax for
the land to support the pope.
This donation, known traditionally as "Romescot,"
was collected on the feast of Saints Peter
and Paul, and was sent to the pope as a gesture of
solidarity and support for the papacy.
But for the Catholic Church at the time, that
income source alone is not sufficient, and
they soon begin to sell
bonds to the Catholic faithful.
These bonds are essentially financial instruments
that individuals can purchase, thereby loaning
money to the Vatican with the
promise of repayment, often with interest.
This method allowed the Vatican to raise the
necessary funds while engaging the faithful
directly in supporting the papal mission.
But the Vatican doesn't stop there.
As the capital market system is being adopted
across Europe, the Vatican Bank, with vast
amounts of gold, needs to diversify into other
assets and grow its wealth.
And the Vatican begins investing in real estate
across Rome, buying up properties and renting
them out to generate income.
But the Church also realizes the potential of
stocks and begins investing heavily in
the stocks of the Bank of Rome,
hoping to grow the wealth of the Church.
The investment in the Bank of
Rome has been a profitable one.
Within years of investing in the bank's stocks, it
has created huge profits for the Church.
As the Vatican emerges onto the financial market as
a major player, many companies,
and even countries begin to view the Vatican as a
partner to do business with.
One of them is Germany.
After the assassination of Archduke Franz Ferdinand
of Austria-Hungary by a Serbian
Europe is once again thrown into war on a scale
unprecedented in world history.
As the war escalates, Pope Benedict XV, who assumed
the papacy in 1914, finds himself
navigating a treacherous path
between the warring nations.
The war has caused a lot of
financial strain on the Church.
Remember, the Church's major income comes from
donations from various countries.
During wartime, people simply don't
have the money or the time to donate.
But Germany sees the importance
of having the Vatican as an ally.
Germany also knows that it can't
just give money to the Vatican outright.
Germany was covertly funneling cash to the Church
through Swiss banks and labeling it
Peter's Pence.
That helped stabilize the Church's finances.
The German Foreign Ministry separately sent the
Vatican cash from a propaganda slush fund.
And the Austrians joined with a
clandestine subsidy to Benedict.
And it soon becomes clear that the Vatican is an
ideal party for covert money operations.
The Vatican realizes that it needs a professional
to manage its growing financial empire.
And soon, they find the perfect man for the job.
Bernardino Nogara grew up in a middle-class farming
family with Jewish lineage near Lake
Como.
But Nogara was a devout Catholic who graduated with
honors in industrial and electrical engineering
from Politecnico di Milano
Starting in the mining industry, Nogara quickly
develops a reputation for his financial acumen,
especially his ability to manage risk.
His career propels him to become the Italian
delegate to the Ottoman Public Debt Council
and to participate in the Versailles Peace
Conference after World War I.
And for Nogara, a bigger opportunity awaits.
After a masterly speech by Premier Mussolini the
Senate this evening by 315 votes to six
Approved the latter entreaties affecting the
pacification of the church and state in Italy
amidst stirring scenes of enthusiasm
In 1929, the country of Italy and the Vatican
reached a landmark agreement.
Known as the Lateran Pax, it creates Vatican City
as its own country, allowing the Pope
to rule it.
As part of the agreement, the government of Italy
pays the Holy See 750 million Italian
lira in cash and 1 billion
lira in government bonds.
With this sudden increase in capital, the Vatican
needs a man capable enough to manage
it.
Nogara was very well connected, even though there
were some whispers about the family's
Jewish background.
He seemed like a very faithful Catholic and had a
really strong financial expertise, so
Pope Pius chose him to handle the significant funds
that came from the Lateran Pax.
Within just months, after Nogara becomes the banker
for the church, a global crisis erupts.
Premier Mussolini delivered in the Senate a frank
and caustic speech on Italy's financial
and economic situation in which he blamed this
country's ills on the depression in
America.
Initially, after the crash of 1929, there was a
V-shaped recovery, and people thought
it was just a temporary stock market glitch, but
the real economic depression didn't really
hit until two and three years later.
By 1932, the Great Depression has
reached and spread all over Europe.
The Vatican sees its assets lose 30% of their
value, and its debt payments mount.
To tackle the financial difficulty, Pope Pius XI
gives Nogara full authority to do whatever
is necessary to help save the Vatican's finances.
For Nogara, it is the biggest
challenge he has ever faced.
He knows that if he lets the Vatican go bankrupt,
all the blame will fall on him, and he may
go down as one of the most hated people in history.
To boost finances, he asks the Pope to declare 1933
a holy year to boost donations from believers.
Nogara also begins to hedge against any potential
financial downfall by loading up on gold.
The way we like to describe gold
is it's a hedge against debasement.
Let's go back to the word debasement.
Where does it come from?
Adding base metals into precious metals.
You're debasing the gold.
So if you own pure gold, it's a
really good hedge against debasement.
He also begins to buy up real estate at low prices
in France, Britain, and Switzerland.
At the same time, he notices price discrepancies
with various government bonds.
He sees an opportunity for arbitrage.
To ensure his actions don't draw unnecessary
attention to the Church, he establishes a
network of holding companies to manage these
investments discreetly, ensuring confidentiality
and minimizing political and financial exposure.
Thanks to his trading strategy and financial
acumen, the Church avoids another financial
collapse by 1936.
His strategic investments position the Church for
an unprecedented recovery, especially
with its real estate holdings soaring in value.
Bernardino-Nogara is now one of the most important
and powerful men in the Vatican.
The Vatican may have bounced back from the Great
Depression, but little does it know
that another global crisis is about to erupt.
On September 1, 1939, Germany invades Poland,
showing the world just how powerful the country
has become.
What Hitler's army introduced was
the onset of mechanized warfare.
So this is tanks supported by infantry, artillery
supporting them, and then on top of that you
had tactical air support.
They're all coordinated, synchronized, harmonized,
and moving very, very rapidly.
Back in Italy, Mussolini's government
is preparing to make a move as well.
Nogara sees a great risk with
the potential global conflict.
He realizes the urgency to
safeguard the Vatican's assets.
The way to do this is by moving assets to neutral
countries at the time, namely Switzerland
and the United States.
But America won't remain neutral for long.
Yesterday, December 7, 1941, a date which will live
in infamy, the United States of
America was suddenly and deliberately attacked by
naval and air forces of the Empire of Japan.
After the Pearl Harbor attack,
America is drawn into the war.
The US also begins economic sanctions on Axis
powers, including Japan, Germany, and
Italy, with asset freezes and import controls.
This is when Nogara's talent really shined.
His goal was solely focused on maximizing and
safeguarding the church's wealth.
And because of his strategic investments in
America, he was able to secure exemptions
from the US economic sanctions.
And he doesn't stop there.
To better navigate the financial environment during
World War II, Nogara realizes that
the Vatican should have its own bank, one that has
the ability to operate in complete
secrecy and without any transparency.
On June 27, 1942, the Vatican establishes the
Istituto per le Opere di Religione, also known
as the Vatican Bank.
The IOR operated without the need to disclose its
financial statements or activities publicly,
did not pay taxes, and was
not required to show profits.
It also had the unique ability
to destroy its files every decade.
It's a perfect vehicle to hide and launder money.
By 1945, Nazi officials
realized that they are losing.
They turned to the Vatican
Bank to help move their money.
It is estimated that the Nazis stole $598 million
dollars, this is 1945 dollars, worth
of gold.
Around 200 million Swiss francs worth of gold are
allegedly funneled through the Vatican
Bank and possibly
transferred onwards to South America.
And it doesn't stop there.
The Vatican also begins helping Nazi fugitives
escape to South America as well.
U.S. intelligence had concluded that Archbishop
Antonio Cajano, a close Peron ally, was a
conduit between the Italian escape networks and the
South American Church, and that the
Vatican, as an institution, not merely as a group
of scattered rogue clerics, was helping
high-ranking Nazis escape justice.
In the aftermath left by World
War II, the continent lies in ruins.
From the smoldering ashes of once great cities to
the shattered lives of millions, Europe
now needs rebuilding.
To take full advantage of Europe's resurgence,
nogara realizes there are two industries in
which the Vatican must invest heavily, the
construction industry and the banking industry.
Real estate has been, and perhaps always will be, a
profitable business for the Church.
In 1956, the Church made millions just by selling
lands to Italy to prepare for the
Summer Olympics.
As the Vatican Bank widens its financial empire
across different countries, it needs someone
with legal expertise to
streamline transactions and investments.
And in the late 1950s, an up-and-coming financial
hustler is looking for an opportunity to make
a name for himself.
His name is Michele Sindona.
Michele Sindona grows up in a
poverty-stricken family in 1920.
But even as a young man, Sindona shows an
above-average ability with numbers.
Michele Sindona's aptitude for math wins him a full
scholarship to the University of
Messina.
But after graduation, he
feels stuck at a dead-end job.
He knows that to become rich, he must be willing to
take risks that others don't
have the guts to take.
Soon, he finds his groove, helping wealthy people
and organizations evade taxes, including
the mafia.
At the beginning of the 1950s, he traveled to New
York and met with the Gambido family.
In 1957, he had become closely associated with them
and was chosen to manage their profits
from heroin sales.
His ability to help people avoid taxes means he can
maximize profit for his clients.
It is a skill highly desired by the Vatican.
In early 1959, the future pope of the Catholic
Church, Montini, John XXIII, wants to build
a retirement home called Casa Madonina.
But he wants to raise money secretly and quickly.
So he turns to Sindona for help.
Sindona was able to raise $2 million
needed for the project in a single day.
This kind of speed of moving money around will come
really handy for the Church in the
future.
In the end, working with Sindona will be one of the
worst mistakes the Church has ever
made.
But in the meantime, the Church is poised to make
more tax-free money than at any other
time in its history.
As the Vatican's finance becomes more global, the
Church promotes Cardinal Paul Marcinkus
as the president of the Vatican Bank.
Marcinkus grew up in a
working-class American family.
He was educated at Quigley Preparatory Seminary and
later at the University of St. Mary of
the Lake in Mundelein, Illinois, where he was
ordained a priest in 1947.
The 6'3" American-born Marcinkus seemed more like a
football lineman than a low-ranking
clerical bureaucrat assigned to
the Secretary of State's office.
When he drank whiskey, he did not hide the bottle
when a senior cleric walked into the
room.
He smoked cigars and did not ask
permission before lighting one.
As American working for the Vatican,
Marcinkus was a very great diplomat.
He was adept at handling all the international
assignments given by the Church.
And he managed to become a part
of the inner circle of the Pope.
For Marcinkus, his predecessor
Nogara's achievements loom large.
He knows that although he doesn't have that
financial genius, he is determined to accomplish
great things for the Vatican by
working with smart financiers.
People like Sindona and Roberto Calvi.
Roberto Calvi grew up in a banking family.
His father was a prominent banker.
At a young age, his father showed him there was
only one business worth getting into.
The business of money.
From the very beginning, he learned that by
networking and moving money around, it was
possible to build a fortune without having to
create or build anything himself.
In 1960, while working at Banco Ambrosiano, a bank
catered to Catholic clients, Calvi
has the major breakthrough when
Sindona introduces him to Marcinkus.
As the new president of the Vatican bank, Paul
Marcinkus is criticized for his lack
of financial training.
Marcinkus believes that in order to make up for
that shortcoming, he needs to do something
big.
And Calvi could be just the
guy to make it happen for him.
Unlike his predecessor, Nogara, he lacked the
ability to master the complexities of
international finance.
Some speculate that Marcinkus, being financially
illiterate, was easily taken advantage of
by Calvi and Sindona.
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As the chief at the Vatican bank, Marcinkus wants
to greatly expand the bank's business
and operation to a global scale.
Roberto Calvi immediately sees this as an
opportunity to prove himself to Marcinkus.
At the time, the Vatican bank and Banco
Ambrosiano wanted to engage in more aggressive,
riskier and more profitable businesses.
But being in Italy, they
faced a lot of regulations.
An obvious way to circumvent this was by creating
satellite banks in other countries with little
to no regulations.
Calvi decides to partner with Sindona, and together
they form Sisselpene Overseas Bank
in the Bahamas.
This bank will serve as a vehicle to channel
Vatican money discreetly and use that to enter
the global market, especially the American market.
With the backing of the tax-free money from the
Vatican, Calvi and Sindona decide to go
on a buying spree.
In Italy, he and Calvi bought La Centrale
Financiaria, a financial holding company that
had long been on his wish list.
And at the behest of Graham Martin, the American
ambassador to Italy, Sindona purchased an
influential Rome-based
English-language newspaper, The Daily American.
For Sindona, there is a
grand prize waiting for him.
The Lowe's Corporation announced yesterday that it
had sold a block of one million shares
of the Franklin New York Corporation, the parent
company of the $3.3 billion Franklin
National Bank, to FASCO International Holdings AG,
which is wholly owned by Michele Sindona,
an extremely wealthy but
little-known Italian financier.
Franklin National Bank is the 18th largest bank in
America at the time of the takeover,
with assets valued at $3.4 billion.
Michele Sindona has gone from an Italian lawyer to a
banking tycoon in America.
Within just a few short years, Calvi and Sindona
have grown their own financial empires
bigger and faster than almost anyone.
With the protection and backing of the Vatican
Bank, no one can touch them.
There is but one exception.
After taking over a Franklin National Bank, Sindona
begins to engage in risky foreign
exchange trades using the bank.
Soon enough, the bank incurs
tens of millions in losses.
The outflow of deposits from the Franklin National
Bank increased somewhat during the
week ended Wednesday.
As a result, the bank has now lost nearly 24% of
its deposits since its troubles first
came to light on May 10.
Four thousand miles away from the U.S., Sindona's
investment in Italian banks also begins to
fail.
This must have been a really
chaotic period for Sindona.
He tried to use his legal expertise by merging
various banks together to hide losses.
Sindona hopes that as a major U.S. bank, Franklin
National Bank will survive through a government
bailout.
But he has no idea what is about to happen.
The Franklin National Bank was declared insolvent
yesterday in the largest bank failure in American
banking history.
The institution was immediately taken over by the
European American Bank and Trust Company,
a New York state chartered entity owned by six of
the largest banks in Europe.
By the early 1970s, Sindona's
world is collapsing down on him.
The Italian authorities have liquidated all of his
assets in Italy and seek the extradition
of Sindona from the U.S.
And with Franklin National's collapse, the U.S.
Justice Department is also looking to
indict Sindona.
With the complete collapse of Sindona's empire, one
man sees an opportunity to exploit and
profit from the situation for himself.
With his former partner in peril, Calvi realizes
that he can take over Sindona's assets for
pennies on the dollar and use that
to deepen his ties with the Vatican.
So he essentially claimed the stocks that Sindona
used to own in these various shell
companies and satellite banks, making himself the
largest shareholder in all of these firms.
And with Sindona in jail, the Vatican's
international business is now
mostly in the hands of Calvi.
The Ambrosiano and the Vatican bank were shuffling
back and forth tens of millions of dollars
between their many offshore companies.
The IOR by this time had loaned or invested $175
million in Calvi-backed offshore companies.
But Sindona, desperate, is not
about to back down from Calvi.
He begins to threaten and attempt
blackmail against his former partner.
Sindona tries to force Calvi to provide financial
help to cover his spiraling legal costs and
to support him through fraudulent schemes.
Under pressure, Calvi gives in.
He diverts substantial funds to Sindona.
This includes a significant transaction where Calvi
is forced to wire $500,000 to Sindona's
account under duress.
But for Sindona, it isn't enough.
He demands more payment from Calvi.
When Calvi refuses, Sindona tips off journalists
about Calvi's secret Swiss bank accounts,
leading to massive public and legal scrutiny.
In just three years, Calvi struggles to keep his
financial empire afloat amid mounting
legal and financial pressures.
His own financial empire is crumbling.
By 1982, Roberto Calvi realizes that his financial
schemes cannot be sustained any longer.
On the night of June 10th, he
decides to flee Italy for London.
From Mugia, an Italian smuggler arranged for him to
be driven overnight to Austria, where
he shuttled between several cities for a few days
before boarding a private charter
in Innsbruck for a flight to London.
He spent the last three days of his life in flat
881, a tiny room at the Chelsea Cloisters,
a dreary guest house in the
capital's posh South Kensington district.
The body of a missing Italian financier, Roberto
Calvi, the central figure in a $790 million
fraud scandal, was found hanging from a London
bridge Friday, the police said today.
Mr. Calvi, dismissed as head of Italy's second
largest private bank, had been missing for
nine days.
The police said a stroller came across his body
early Friday, hanging from the scaffolding
of Blackfriars Bridge over the Thames River in the
heart of London's financial district.
No doubt that Calvi had a
strong connection with the Vatican.
His activities helped bring a lot of money into the
church, but as Banco Ambrosiano
came close to failing, threatening to reveal more
than just financial losses, this has
turned Calvi from an asset to
a liability for the Vatican.
Could it be that those who once offered him
protection have turned their backs, or worse,
created his demise to silence his confessions?
Michelle Sindona, who at the time was a disgraced
banker and former ally of Calvi, became yet
another potential suspect.
Their partnership used to be very profitable for
both of them, but now it has gone bad
because of the accusations and betrayals.
Sindona was very clever, and he was
also facing his own legal problems.
He might have seen Calvi's
downfall as a final chess move.
In the cutthroat world of high finance and higher
stakes, revenge is more than just a
motive.
It is a statement.
The darkest possibility is the mafia.
Calvi had been their money manager, laundering
large amount of money through the complex
network of Banco Ambrosiano, but working for the
mafia came with a huge risk.
His death, set up like a dramatic public execution
under a bridge named Blackfriars,
looks like a mafia killing, a warning written in
the criminal world's record.
In the end, the Vatican decides to publicly
acknowledge that it was a mistake to work
with Calvi, but denies that it
has anything to do with his death.
The church agrees to pay $244 million in a legal
settlement involving Banco Ambrosiano
The public scandal is a huge blow to the church.
Seeing their money being misused, Catholics around
the world decide to lower their contributions
to the Vatican, leading to a budget deficit for the
church from around 1984 to 1985.
After the death of Calvi, Sindona fights hard to
avoid being extradited to Italy, because
he knows that may just be a
death sentence for him as well.
But on March 30, 1985, Italian authorities
successfully extradite Michele Sindona to Italy.
Sindona's worst fear comes true.
Michele Sindona, one of Italy's most successful
financiers whose empire collapsed amid charges
of fraud and murder, died today in a Voghera hospital
of cyanide poisoning.
He was 65 years old.
His mysterious death removed from the scene a man
who was at the center of many of Italy's
most important recent
financial and political scandals.
Sindona was one of Mafia's favorite member, but
things changed when his golden touch failed,
losing millions in Mafia's money through bat
management and the eventual collapse of
his financial empire.
The Mafia, like the Gambido family, known for their
ruthlessness, rarely forgives such
a mistake.
His fall from grace makes him a marked man.
His knowledge and potential cooperation with
authorities make him a dead one.
The cyanide-laced coffee could easily have been the
Mafia's closing statement, a signature
act of retribution.
Their reach extends even behind
bars, and the message is clear.
Betrayal, real, or perceived is a
deadly sin with only one atonement.
Archbishop Paul Marcinkus had long dealt with the
murky finances of the Vatican.
His partnership with Sindona had
been very extensive and secretive.
But as Sindona's usefulness decreased and his risks
increased, rumors of his potential
testimony involving Vatican-backed operations
turned him from a helpful ally into a threat.
Could it be that Marcinkus, acting on a higher
directive or his initiative, orchestrated
Sindona's silent assassination to forever seal
those lips that threatened to speak?
With the permanent silence of Calvi and Sindona,
the Vatican's secret dealings with them may
be permanently buried.
But what they don't know is that
their trouble is far from over.
Vatican authorities last week issued a warrant for
the arrest of Archbishop Paul C. Marcinkus,
but it did not appear that they would be
confronting him anytime soon.
For the Vatican, if an archbishop is arrested, the
publicity will be a huge blow to the Church,
and it will likely destroy the beliefs of many of
the faithful, leading to even less
donations from them.
Remember, the Vatican is its own sovereign state.
So they don't have to let any
country arrest any of their own people.
So the Church fought really, really hard against
Italian jurisdiction over Marcinkus.
The Vatican, throwing its full weight behind
Archbishop Paul C. Marcinkus, issued a sharply
worded statement today expressing "profound
astonishment" at efforts by the Italian authorities
to arrest the American head of the Vatican bank and
two of his closest associates.
Despite being implicated in the massive financial
scandal surrounding the
collapse of Banco Ambrosiano
in 1982, Marcinkus manages to avoid legal
consequences primarily due to the legal protections
afforded by his position within the Vatican.
In the 1990s, the Vatican bank faces
unprecedented scrutiny and scandal.
The institution struggles under the weight of
corruption allegations and financial mismanagement.
With the retirement of Marcinkus, the Church is
eager to look for a replacement that can
restore the trust of the Vatican bank.
The Church was looking to hire Angelo Caloia, a
respected banker known for his commitment
to ethical finance.
Caloia is the CEO of Mediocretito Lombardo, a
prominent merchant bank in Milan.
Notably, he is deeply involved in the Catholic
financial community as a leading member of
the Group for Culture, Ethics, and Finance.
The Church realizes to help repair the damaging
reputation left by Marcinkus, Caloia is the
perfect candidate for the job.
The Vatican today turned over the management of its
scandal-tainted bank to financial experts
not connected with the clergy, ending the 20-year
presidency of Paul C. Marcinkus, an
American archbishop.
During the first few years, Angelo Caloia battles
internal resistance and attempts reforms.
With secret accounts, illicit financial flows, and
high-profile legal challenges, the bank
struggles highlight significant governance issues.
The results of Caloia's initiatives are mixed.
The IOR continues to face
legal and ethical challenges.
The Vatican and Caloia may have been focused on
fixing the Church and its finances, but
their problems are about to be dwarfed.
A crisis is brewing, one that will expose a
darkness far greater than any financial misdeeds.
Cardinal Bernard Law, who protected the priest
accused of molesting more than 130 children,
is under growing pressure to resign himself.
Boston's Bernard Cardinal Law breaks his silence
and apologizes in the case of a former
priest accused of molesting children.
More than 130 people have accused this man, John
Gagan, of assaulting them over three
decades, and dozens have charged that Cardinal Law
and the Catholic Church protected Gagan.
In 2002, a series of reports by the Boston Globe's
investigative team, known as the
Spotlight Team, uncovers a pattern of sexual abuse
by priests in the Boston Archdiocese,
as well as efforts by church leaders to cover up
the incidents and protect the abusers.
The escalating sexual abuse scandal involving a few
priests has shaken not just the American
Catholic Church, but also the Vatican.
Pope John Paul II has summoned U.S. Cardinals for a
meeting next week in Rome.
The meeting will provide "guidelines aimed at
restoring a sense of safety and tranquility
to families and trust to clergy and the faithful."
While the scandal is initially most prominent in
the United States, similar allegations
soon emerge worldwide, including in Ireland,
Australia, Canada, and various countries in
Europe and Latin America.
As a result of the scandal, the Vatican faces a
financial fallout on a scale they have
never seen in its recent past.
The scandal crushes the faith of
many Catholics around the world.
Many dioceses worldwide face enormous financial
burdens due to settlements and legal costs
associated with sex abuse cases.
This leads to some dioceses, like
Portland, Oregon, declaring bankruptcy.
Others have to liquidate assets, close schools, or
tap into clergy pension and retirement
funds to cover settlements and legal expenses.
The scandal affects the Catholic Church's income,
particularly contributions to the
Peter's Pence Collection,
which supports Vatican activities.
Amid the scandal and the financial difficulties,
Pope John Paul II passes away on April 2,
2005.
After the passing of Pope John Paul II, a
surprising candidate rises to the top and
gains the votes to become the next pope.
Cardinal Joseph Ratzinger becomes the first German
pope in a thousand years.
He became pope at a very peculiar time.
The church, and particularly the Vatican bank, was
still acting with a lot of secrecy and
backroom dealings.
There was a demand from everyone else for more
transparency and adherence to regulations
in different countries.
As the new pope, Benedict makes efforts to increase
transparency and compliance within
the Vatican's financial
institutions, particularly the Vatican bank.
To repair the broken image left by the sex scandal,
Benedict takes significant steps
to address the clergy sexual abuse crisis.
He is the first pope to meet with abuse victims, an
action he repeats in several countries.
But none of his actions will
prevent the storm that happens next.
The Pentecostal Mass at St Peter's Basilica.
It is normally a moment of celebration, but these
are difficult times for the leader of
the Catholic Church.
His Holy See at the center of scandal.
And hours before the pope's personal butler, Paolo
Gabrielle, was charged with possessing
confidential papal papers.
In 2012, Paolo Gabrielle, the butler to Pope
Benedict, steals and leaks documents exposing
internal Vatican correspondence, including letters
and memos between high-ranking officials.
They reveal a range of issues, such as allegations
of corruption, financial mismanagement, power
struggles, and internal
conflict within the Vatican hierarchy.
The leaks caused huge embarrassment to the Vatican,
exposing deep rifts and power struggles
that led to widespread media coverage and public
scrutiny, adding pressure to an already
embattled institution
grappling with various scandals.
The Vatican condemns the leaks and initiates an
internal investigation, which leads to
the identification and arrest of Gabrielli.
He is subsequently tried and found guilty of theft
in October 2012, receiving a sentence
of 18 months in prison, which is later commuted by
Pope Benedict XVI as part of a papal pardon.
By 2012, the pressure that Pope
Benedict XVI faces is immense.
At the same time, the U.S. lists the Vatican as a
concern for money laundering.
The State Department has put the Vatican on a list
of countries of concern for money
laundering or other financial crimes.
Robert Mickens, correspondent for the Catholic
Weekly The Tablet, says it's suspected that
the Vatican bank is run like an offshore bank.
Like a Swiss bank account, hiding funds, it's
suspicion, but many of the regulators think
it's well-founded suspicion.
To make matters worse for the church, Italy's
central bank blocks electronic payments in
the Vatican due to its
noncompliance with EU regulations.
A month later, Pope Benedict
makes a shocking announcement.
Welcome back to ABC Action
News on this early Monday morning.
We're following breaking news as
you wake up and get your day started.
Pope Benedict XVI announcing just a little over
half an hour ago that he is stepping
down as leader of the Catholic Church.
This is an unprecedented move in modern times.
It's been many hundreds of years since the Pope
resigned while in office.
Most of them, of course, die while in office.
The situation facing the Vatican may seem dire, and
the next Pope is going to change
all of that.
Jorge Mario Bergoglio was born on December 17,
1936, in Buenos Aires, Argentina.
Before 2013, he served as the Archbishop of Buenos
Aires from 1998 and was made a cardinal
in 2001 by Pope John Paul II.
Following Pope Benedict XVI's unexpected
resignation, the Cardinals have a very limited
time for any pre-conclave political maneuvers.
Despite not being a front-runner and having
previously planned for retirement, Bergoglio
emerges as a strong candidate in a tightly
contested election, ultimately winning on
the fifth ballot.
Pope Francis quickly distinguishes himself with his
humble, populist approach, contrasting
sharply with his predecessor's style.
He shuns traditional papal luxuries and focuses on
outreach to the poor and marginalized.
His approach to contentious issues like
homosexuality, abortion, and
church doctrine is more inclusive
and compassionate, which resonates with many but
also sparks debates about the potential
for doctrinal changes.
Pope Francis was much more
progressive than his predecessor.
Early in his role, he refreshed the church's image,
appealing widely to Catholics and non-Catholics
around the world.
The effects of Pope Francis have
fared even better for the Vatican bank.
As a result of increased mass attendance and
volunteer participation in Catholic charities,
the Vatican bank receives an unprecedented amount
of donations from the faithful again.
In 2024, under the leadership of Pope Francis, the
Vatican bank publishes annual financial
reports regularly, enhancing its transparency.
While Europe and America see a decrease in the
number of priests, there is an increase
in Africa and Asia, indicating a shift in the
geographic centers of growth within the
church.
Despite its recent turbulent financial crises, the
church may have finally found a place
There are nearly a thousand men, most celibate, who
live and work together and
wield not only great earthly power,
but who believe for the most part that they have
inherited divine rights and
safeguarding the one and true Church.
In the end, they are human, hobbled by the same
frailties and shortcomings
common to the rest of us.
The Vatican will always be a
unique presence in the world.
Throughout its recent history by embracing
capitalism, the church has engaged in many
predatory practices that go
against the Catholic faith.
The global Catholic population continues to grow,
reaching 1.378 billion by the end of
2021, which represents a 1.3%
increase from the previous year.
In the long run, regardless of its past mistakes,
this powerful and seminal institution will
live on.
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