The Pope’s Italian Problem, Cardinals and the Vatican Bank

Michele Sindona, a key figure in Vatican Bank money laundering during 1980's
Michele Sindona, a key figure in Vatican Bank money laundering during 1980’s

Italian cardinals wanting to keep power within their ranks, decades-long money laundering by the Vatican Bank, as well as sex the ongoing scandals, create impossibly toxic politics inside the Vatican.

The Italian cardinals are determined to install one of their own to stop the public relations hemorrhaging wrought by the sexual abuse scandals and to keep the string going of Rome-centered power that has spanned centuries.

The Vatican Bank scandal has been going on since at least the 1980s and is, I think, the bigger story, helping to explain why the Italian Cardinals don’t want an outsider pope poking around.

The [Vatican Bank] is a successful and profitable bank. By the 1990s, the [bank] had invested over US$10 billion in foreign companies. In 1968 Vatican authorities hired Michele Sindona as a financial advisor, despite Sindona’s questionable past. It was Sindona who was chiefly responsible for the massive influx of money when he began laundering the Gambino crime family’s heroin money (taking a 50% cut) through a shell corporation “Mabusi”. This laundering was accomplished with the help of another banker, Roberto Calvi, who managed the Banco Ambrosiano.

The Vatican Bank denied having legal responsibility for the Banco Ambrosiano’s downfall but did acknowledge “moral involvement”, and paid US$241 million (£169 million) to creditors.

Calvi was found dead, hanging from a bridge in London in 1982. His death was eventually judged to be murder, not suicide.

On May 24, 2012, Ettore Gotti Tedeschi was ousted as Head of the Vatican Bank because of “failure to fulfill the primary functions of his office”. He is currently being investigated on suspicion of money laundering.