By Thom L. Jones for Gangsters Inc.
“You never know what enough is unless you know what is more than enough.” - William Blake
It’s a story with more twists and turns than a novel by Agatha Christie. A list of characters, narratives and story-lines that range from failed, wannabe-gangster Henry Hill, to Pope Paul VI, the Sicilian and New York Mafias, the Italian Secret Service, an illegal Masonic Lodge, several of the most prominent banking institutions in Europe and America, two former presidents of the United States, and the head of the Italian government.
A chronicle of greed and financial corruption with problem-solving by murder.
Intrigue, and double-dealing along with political manipulation, on a scale that is bigger than Ben Hur.
Some of the leading players will end up dead.
One is shot outside his home in Milan. Another is hung by a rope under a London Bridge; a hit-man crushed under a 400-pound Cuban drug dealer after they both fall off a prison roof. The leading actor poisoned by cyanide in a maximum-security prison while under watch by 15 guards.
Like Eulerian Circles, the links are overlapping, chasing each other in ever-decreasing orbits to that final day when the piper is paid in Voghera, Lombardy.
If this were a movie pitch, no self-respecting Hollywood producer would even look at it. So outlandish a shooting-script, it will never get past the first assistant PA.
And yet it happened.
The Banker: Michele Sindona
He was born on May 8, 1920, in Patti, a small village on the north-east coastline of Sicily, in the province of Messina. His father worked on a cooperative farm, and moonlighted as a part-time florist, specializing in funeral wreaths, so death was part of this child’s life from an early age. His parents christened him Michele.
Young Sindona attends a Jesuit school, starts working part-time at fourteen, and then university in Messina, where he graduates with a law degree in 1942. His thesis is on The Prince, Niccolò Machiavelli’s 16th-century treatise on political philosophy. The handbook of many successful criminals. He avoids conscription into the army using a friend of a friend of his fiancée, Caterina Cillio, who works in the Vatican.
For the next three years, he employs his talents and skills with numbers to make a good living on the black market. He buys cheap in Palermo and sells dear in Messina. He would develop and use these skills in the years ahead to make himself, on paper at least, one of the richest men in the world. At one stage, it is alleged he deals with Vito Genovese, the mob boss from New York, living in self-imposed exile in Italy to avoid a murder indictment. It’s also claimed he was mentored by Calogero Vizzini the legendary boss of Villaba, in Caltanissetta. This may have been Sindona’s first contact with the Mafia. There would be plenty more in the years to come.
The bishop of Messina became his friend and in 1954, would give him a letter of introduction to Cardinal Giovanni Battista Montini, the papal secretary of state, and a future pope in the making.
In 1947, now married, Sindona and his wife moved to Milan. They rent an apartment in Affori, a suburb to the north of the city center, and he starts working as a lawyer and accountant, specializing in tax, and how to avoid paying it. He dabbles in real estate, makes contacts with people north and south of the line between good and evil and, develops a reputation as a man who knows silence is golden. He’s from Sicily where it’s the air they breathe.
It’s alleged that it was in Lombardy, that he first developed a close association with Sicily’s Mafia clans and those in America, and was close enough to them to be invited as a guest to the famous American/Sicilian Mafia meeting allegedly held in Palermo, in 1957.
New York’s Gambino family
The Gambino Family of New York is the one referred to the most often outside of Sicily, so it would have to be after the killing of the then family boss, Albert Anastasia, in October of 1957. Carlo Gambino did not assume leadership until later that year or even early 1958.
The Gambinos were connected to a powerful Palermo-based Mafia family, ran by Salvatore Inzerillo, through his cousin Don Carlo himself.
Inzerillo was big on drug trafficking, and his New York partners were, it seems, happy to be part of an Italian- American consortium helping to pump in tons of heroin from Sicily to satisfy a demanding and seemingly endless market, generating mountains of illegal cash.
By the 1970s. Italy’s anti-drug agency claimed Sicily was the primary supplier of heroin to America, estimating its value at $6 billion.
That’s where Michele Sindona (right), it appears, came into the picture. He used his skills to become a significant “washer” of the mob’s endless mountains of cash. His point of contact in America at least seemed to be Giovanni Gambino, New Jersey-based, and a distant relative of Carlo Gambino and part of his New York Cosa Nostra Family.
Sindona’s link into Inzerillo was confirmed by the testimony of Mafia informant Francesco Marino Mannoia in 1989. He also verified Sindona laundered money for other mob bosses, such as Rosario Riccobono, head of the Partanna Mondello clan, Francesco Di Carlo of Altofonte and Salvatore Riina, who rose to become the Mafia super boss in the early 1980s.
The banker may have also had a connection to Luciano Leggio, the capo of Corleone, who would come to be if not the king, then certainly a rook on the chessboard that was the Mafia landscape of Sicily in the 1960s and early 1970s.
In 1967, the Washington office of Interpol flagged the Italy police that their findings indicated Sindona was a major money-launderer for the Sicilian Mafia. No one bothered to follow this up.
Buying a bank
Early in his career, Sindona realized that the easiest and safest way to steal from a bank is to buy one first. So he did. His mantra in life was companies are bought and sold, banks are bought and held.
He opened an office in Via Turati and started his own, private war, on the world of wealth.
In 1959 he developed a holding company in Liechtenstein, calling it Fasco AG, which he then leveraged to acquire Milanese based Banca Privata Finanziara, known as BPF, in 1960. BPF was a small, private, bank, created in 1930 as a conduit to wash money out of Italy for very wealthy clients, people with lots of cash who did not want to share any of it with the state.
In 1962, he raised $2.5 million US dollars to help build a retirement home sponsored by the Archbishop of Milan, his friend, Giovanni Montini. The Catholic Church however, did not know that the source for some of this money allegedly came from the Mafia.
In 1964, Sindona created Moneyrex, an international currency broker that will generate 850 accounts and annual revenues of US $200 billion. His clients used it to shield their earnings from taxation through off-shore investments. These included high ranking members of the Christian Democratic Party, which effectively ruled Italy from 1946 until 1992, the Mafia, and Vatican City. If money is the root of all evil, there was an enormous cesspit of it mutating illegally in Italy during these formative years of Sindona’s banking career.
The freemasons enter the picture
In addition to organized crime and the Catholic Church, Sindona invested funds for a strange Masonic Lodge founded in 1945 known as Propaganda Due, which the banker joined in 1964, given a membership number of 1612. Its charter was withdrawn in 1976 by the governing body, The Italian Grand Orient, and it then transformed into a clandestine, pseudo-Masonic, ultra-right organization led by a figure as mysterious as Sindona, a textile manufacturer, and the Grand Master, Licio Gelli (right), who was himself, a client of Sindona.
The P-2, as it became known, was filled with people who wielded a lot of influence in Italy. Not just lawyers, and businessmen, doctors, and stock-brokers, but also mayors, and politicians, senior police officers, (at one time it held the police chiefs of four major cities,) forty-four members of parliament, including three ministers of the cabinet, generals, admirals, diplomats, and, during the same period, the heads of the three different secret service departments that operated within the state.
- READ: Emanuele Notarbartolo, the man who fell from the train, and the dark heart of Italy
And members of the Mafia. Stefano Bontade, one of Palermo’s biggest Mafia bosses, was one of them.
As Leonardo Messina, a senior Sicilian mafioso who defected in 1992, explained under questioning, many senior members of Cosa Nostra belonged to the Masonic movement because it was a place for men who managed power.
A friend of Sindona once told him, “Your force is the Mafia, and your power is Freemasonry.”
And so the power and the force were with him.
The Scam: All the banks are mine
Using Fasco as his blue-chip, Sindona started acquiring companies in Italy and America.
His greed for more escalates in only the way greed can. Paper manufacturers, food producers, steel, pharmaceuticals, a hotel chain, a wide-ranging and diverse portfolio. Buying and selling companies as though they were used cars, he claimed he was a bridge between American and European industries.
By the time he set up Moneyrex, he was the president of seven companies and a director of fifteen others. He would come to have shareholdings in Hollywood, and among his property portfolios in America is an apartment complex in Washington DC called Watergate.
Through his financial connections, he meets David Kennedy, chairman of the Continental Bank of Chicago, and the treasury of secretary to President Richard Nixon with whom Sindona becomes acquainted.
It was alleged Sindona offered one million dollars towards Nixon’s 1972 re-election campaign, although the offer was turned down. If he was not dancing in the mouths of wolves, he was close to it.
He and his wife and three children spent their time between an opulent apartment in Milan and a Renaissance-style mansion in the country, fifteen miles north of the city. A collector of art and fine wines, by his mid-forties, the world, if not an oyster, was undoubtedly a big, luscious clam.
And then there were the banks. First BPF, then Banco Unione d’Vaticano, followed by controlling interests in Wolff Bank of Germany, Finabank and, Amincorn Banks of Switzerland, along with Banca di Messina in Sicily.
Of all his banking chicanery, the one involving the Vatican is perhaps the most compelling.
The Vatican Bank
Formed in 1942, and called officially, Istituto per le Opere di Religione (IOR), it was designed to manage all the assets, world-wide of the Catholic Church until 1967 when it was in part, replaced by Amministrazione del Patrimonio della Sede Apostolica, abbreviated as APSA.
Perhaps the biggest bank in the world, it has been convulsed, on and off, for decades, by scandals. It’s real estate, and international stock market tranches are worth billions. Its physical storage of gold is perhaps second only to Fort Knox.
To minimize taxes, the Vatican looked for ways to invest off-shore and used Sindona as one of their advisers. His links to Montini, who became Pope Paul VI, gave him access on a scale no other banker could have, at that time. It was rumored Sindona, and the Pope sat down one night in the papal apartment in the Apostolic Palace in Vatican City and crunched the numbers. Two old friends, chatting over the vino and deciding what to do with billions.
Sindona started selling off the Vatican Bank’s holdings, disposing of a lot of its portfolio using his American connection, the chairman of the Continental Illinois Bank.
Ostracized by the “old money” of Milan, looked down upon as a peasant from Sicily, Michele Sindona, above all, wanted to be as famous and especially, respected, as the man who once ran one of America’s biggest and most prosperous banks. Formed in 1922 in Los Angeles and then acquired by Amadeo Giannini, Bank of America was his benchmark.
Sindona moved to New York in 1971 and made his play a year later. Forty-six years after its creation, he bought a controlling interest in the Long Island-based Franklin National Bank for $50 million through Fasco AG. He paid over the odds for a banking institution that was less than what is seemed to be. It would be his downfall.
House of Cards
He now had more than enough and would find out the hard way just how hard too much is too much.
He borrows from Peter to pay Paul, and neither of them wears the cassock of a pope. It’s an endless conveyor, shuffling money around to minimize losses and increase paper profits.
Sindona was a grifter but on a monumental scale. It was ironic that the noun that brought him down originated in the country where everything turned to custard for him.
Maybe he believed in Einstein’s theory. Not the one about e=mc2, instead the one we can all understand, “Imagination is more important than knowledge. Knowledge is limited. Imagination encircles the world.”
The paradox of imagination, however, is that it not only creates innovation, it can also destroy it.
Sindona was smart enough to get his career as far as the Franklin Bank. His financial imagination seemed limitless, but it turned out he did not have the ability to handle the consequences of what he was doing. Many of his American deals turned bad, and he poured money into a seemingly bottomless pit of failed commercial ventures.
His house of cards was not only built on shifting sands, there was also a tsunami on its way. Federal fraud investigators in Italy and America trying to untangle the mess of threads connecting the knots in his financial empire are convinced it’s one big fraud, and somehow, linked into the Vatican.
In December 1973, he invited Giulio Andreotti to a gala dinner at New York’s Waldorf Astoria Hotel. The Italian prime minister congratulated Sindona, referring to him as “the man who saved the lira.”
In fact, Sindona had been responsible for the run on the lira, trying to salvage his bad decisions by borrowing from his Italian banks to the tune of three hundred and fifty million dollars to finance his expansions, and had then helped and advised the Bank of Italy to recover from this very run.
Giulio Andreotti (right), whose favorite saying was, “Political power wears out only those that haven’t got it,” was perhaps, the most corrupt bureaucrat ever, in a country with more political venality per square mile than even Somalia.
Massimo Teodori, author and journalist, referred to Andreotti as, “the dark genius of the Christian Democrats political dealings with Italy’s labyrinthine criminal underworld.” He may well have underestimated him.
A year later, Franklin Bank collapses. It will be the most significant financial crash in America’s banking history to that time. The first since the great depression. The Federal Reserve had poured over two billion dollars into the bank, propping it up. No one knows why.
Across Europe, the major newspapers in Italy, France and, Germany had the same screaming headlines, that the end was nigh.
Hamburg based Die Welt front-paged, FIVE MINUTES TO MIDNIGHT, referring to the doomsday clock.
In a place that spawned the Mafia and the other criminal cartels that have plagued Italy and the world for the last two hundred years, how could there NOT be a banking disaster connected to Italy?
With all of his ducks falling off their row, Sindona made a decision based on desperation rather than logic. He decided to go after the man the Italian government had appointed to sort him, hoping it would all go away. Which it did, until a low-life, alcoholic, drug-addicted gangster plying the streets of New York came into the picture.
The Victim: Giorgio Ambrosoli
In September 1974, the Italian Ministry of Treasury appointed Giorgio Ambrosoli, a lawyer, as liquidator of Banca Private Italiana, which had become drained of funds propping up Franklin Bank in America and other companies owned by Sindona. BFI was itself, in dire financial difficulties, insolvent to the tune of 300 million US dollars.
BFI had been formed by Sindona a month earlier, in August 1974, by merging BPF and Banca Unione.
Ambrosoli (left) had become a specialist in 1964 in bankruptcy law, and in particular, in the compulsory administrative liquidation areas, which was why Guido Carli, head of The Bank of Italy, had chosen him to investigate the Sindona banks in Europe and the one in America.
Over the next four years, working mostly 12-hour days, Ambrosoli tried to sort out the complexities of Sindona’s financial empire. In essence, his priority was simple, to reconstruct the bookkeeping records of the bank with a view to possibly recover some or all of its assets for distribution to creditors. In practice, it was a lot more complicated.
He traveled across Europe and back and forth to America numerous times in his attempt to unscramble a financial Rubik Cube of mammoth proportions. The stashing of shares, the buy-backs, the dazzling transfer of incomes back and forward between so many companies. Parallel accounts were kept, and much of the original documentation destroyed. His findings by 1979, ran to 2,000 pages. He discovered that Sindona had pillaged his European banks to purchase Franklin Bank.
There was a challenging lack of enthusiasm to solve the mystery on the part of officials within the Christain Democratic Party, and more and more, he found himself working in isolation and with lack of support. Sindona had friends at the highest level in the CD Party, and more importantly, was managing their money.
Then there was the bribery and corruption of company directors, leveraged on a massive scale.
The lawyer determined that several respectable public institutions like the insurance giant INPDAI, in which many of Italy’s pension schemes had been invested, deposited their funds at Sindona’s banks for a lower rate of interest than was generally current – 8 percent rather than 13 percent. They received, however, a secret interest rate that went directly and privately into the pockets of the directors of INPDAI.
Ambrosoli compiled a list of 77 suspects and irrefutable proof that the Vatican Bank was complicit in many of Sindona’s illegal transactions.
In 1975 he was able to access Fasco in Liechtenstein, the mothership. A Matryoshka doll that opens into hundreds of companies that lead into a forever-land of financial intrigue and sophistry, peeling away the layers of secrecy that had been created over the years.
When Sindona learned of Ambrosoli’s discovery, he sends him a message from his New York base:
“Vengeance is sweeter when it comes from afar.”
Sindona threatens the investigator with legal actions involving embezzlement, then when the stick didn't work, a carrot in the form of a position as president of Sindona’s bank once everything had been resolved the right way.
Threats and Murder
From the beginning, the lawyer was subject to a campaign of harassment and intimidation aimed at persuading him to close down the inquiry. One of the many threatening telephone calls he received had been traced to Giacomo Vitale, brother-in-law to Stefano Bontade, head of the most prominent Mafia clan in Sicily. And a very close friend of Salvatore Inzerillo. One of Sicily’s biggest heroin traffickers. One of Sindona’s most trusted friends as well as a significant banking customer.
By March 1979, Ambrosoli had figured out the losses suffered by the bank. 257 billion lire. Over 200 million United States dollars. This kind of failure was big beyond belief.
Sindona tried to enlist the help of Licio Gelli, to no avail, and then approached Roberto Calvi, another banker, to provide capital to rebuild his empire. They had been friends since the 1960s, and it was Sindona who had sponsored Calvi into P2.
When rebuffed, he began to leak information about Calvi's illegal activities to a journalist, whose investigations were central to the ultimate collapse of Banco Ambrosiano, of which Calvi had been the chairman since the early 1970s.
When it folded in June 1982, it had debts of almost $1.5 billion. Italy had turned into a financial sink-hole swallowing up banks and financial institutions with the appetite of Godzilla.
Calvi and Sindona’s relationship was as complicated as the financial scandal that engulfed Ambrosiano, Italy’s largest private bank with assets of $18 billion at the time it collapsed. Both men had been intimately involved with Vatican City and its banking off-shoot, I.O.R, which would lose millions in the Ambrosiano scandal.
Calvi does a “Sindona” but finds out the hard way, losing a lot of money that belongs to the wrong kind of people always works out bad.
He goes out big, dangling from a yellow rope, by the neck, from scaffolding, under Blackfriars Bridge in London, in June 1982. An apparent suicide. His pockets weighed down with bricks and money, but interestingly, no brick dust on his hands, no rust on his shoes or clothes from the ladder and scaffold pipes he had to climb to get to where he would kill himself.
Calvi’s body was found four miles from his flat, No 881, in The Chelsea Cloister on Sloan Avenue, in the trendy South Kensington area, where investigators found a copious stash of prescribed medications that could have sent him on his way in a much more comfortable fashion.
In 2012, a court ruling in London confirmed Roberto Calvi had not committed suicide but had been murdered. But by whom, the judges ruled, they could not tell, the ruling listing instead all the possible suspects: the Mafia, the P-2, the Vatican’s investment arm, Italian politicians, Italian secret-service members and, even British secret services since Calvi had financed weapons to the Argentine government during the Falkland war.
The London detectives working the case believed he had been transported on a boat, garroted from behind, then dangled under the bridge. It’s as good a premise as any. The only certain thing was that he had to be murdered as far away as possible from Italy. Too big a scandal, even for the Romans.
Three years before Calvi’s exit, Michele Sindona had made the move, in 1979, to try and end his problems.
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Copyright © Thom L. Jones & Gangsters Inc.