Authors: Rupert Cornwell
The
plight of Sindona became desperate. To raise the dollars he
urgently needed, he planned to transfer back to Italy control of
SGI,
the property company he had purchased from the Vatican in 1969,
and subsequently run from abroad. But someone had to provide the
money—and as often in the dealings of both Calvi and himself, that
someone would be the small shareholder. Sindona intended that a
Milanese financial company of his called Finambro would buy
SGI.
Finambro's capital would be raised for the purpose to 160 billion lire
from a mere 1 million lire. The public would be able to subscribe only
to non-voting shares, thus leaving Sindona with practical control.
Unfortunately however, schemes of that dimension required
Min
isterial approval from Rome; and this La Malfa refused to grant.
Sindona was cornered. Despite ever more urgent solicitation of the
politicians, his two Italian banks, Banca Privata Finanziaria and
Banca Unione, saw their troubles steadily worsen. Hope flickered
briefly in mid-1974, as the Nassau subsidiary of the Banco di
Roma,
the big state bank traditionally closest to the Vatican and the Christian Democrats provided him with a most timely loan of $100 million.
But
neither that, nor permission granted
in extremis
for a merger of
the
two
banks sufficed. The newcomer, Banca Privata Italiana
(BPI),
was
all but stillborn. On September 27, 1974, it was placed in
compulsory liquidation after just eight weeks of life, and
Milan
magistrates issued warrants for Sindona's arrest, on charges of fraud
and falsifying balance sheets. But with uncannily happy timing the
bird had flown the day before to Taiwan, a country with which Italy
had
not signed an extradition treaty. Less than a fortnight later, the
American
part
of
his group collapsed, as the Franklin National
Bank
was
declared insolvent in
New
York.
Shortly
afterwards Sindona resurfaced in a permanent suite in
the
opulent Pierre Hotel,
overlooking Central Park in
New York. There
he would
mingle public complaining that he had been the innocent
victim of
a
witch-hunt
conducted by Cuccia,
La
Malfa and others
of
the "lay" establishment
of Italy, with the private conviction
that he
would manage to
avoid trouble on both sides of the
Atlantic. In
America, after all, he
was
not
without friends in the
Republican
administration; while his
old
associates
at
home would
be
kept to heel
by the threat of exposure of a
tantalizing
list of 500 prominent
Italians, said to have exported currency
illegally
through his banks.
He was correct, but only in part, about Italy. The "list of 500", as it
swiftly became known, did periodically cause a flutter in Italian
political circles, and somehow he never was extradited back to face
judgement in Milan. Indeed, notwithstanding his conviction and
sentencing in 1976 to three and a half years in jail
in absentia
(for
falsifying the accounts of Banca Unione), the Christian Democrats—
or at least some of them
—
continued their efforts to persuade the
Bank of Italy to consent to a painless solution of Sindona's difficulties
right up until 1979.
But long before that, his banks around Europe had failed. In
Switzerland, Finabank had accumulated losses of $50 million when it
was closed by the Berne authorities in 1975.
To this day, no-one knows how much the Vatican lost with Sindona;
Marcinkus has claimed that if earlier dealings are taken into account,
the Holy See in fact shows a profit on the association. In any event,
the archbishop kept his job and his influence, despite estimates
elsewhere that involvement with Sindona cost the Vatican anything
from $30 million to $300 million.
Back in Milan, Calvi also looked at first to have survived with
reasonable comfort the tempest caused by Sindona's passing. Indeed, the latter's departure for the United States, the quiescence of
the Bonomis, and the ebbing energies of Carlo Pesenti had left
him seemingly alone on the winning side. But appearances were
deceptive.
After a brief rally in 1973 (partly thanks to rumours that the
little loved La Malfa might resign as Treasury Minister) the Milan
market began to fall in earnest as Sindona's misdeeds unravelled.
Austerita,
moreover, was the watchword of the day, as Italy too faced
up to the harsh economic realities imposed by more expensive oil.
Shares in Calvi's companies were worse affected than most, because
of his known close links with the bankrupt Sindona. But there was
another ingredient to his misfortunes: an apparently deliberate effort
to provoke his downfall. Not only was Ambrosiano stock being
heavily sold on the over-the-counter market, but gossip was doing the
rounds that both the Milan bank and Banca del Gottardo in Switzerland were experiencing difficulties.
Whether the whispering campaign existed—or whether it was an
early product of Calvi's persecution complex—cannot be said with
certainty. He was however sufficiently alarmed to notify the Bank of
Italy of "false and tendentious" rumours, aimed at disrupting
Ambrosiano. Much more important, Calvi took the episode as a
signal that he should begin protecting himself and his bank by all
means to hand.
A perspicacious book which took stock of Italian finance at about
this time observed: "Calvi is condemned to expand. There is little
prospect of an orderly retreat, for almost inevitably these enterprises
end in disaster."* Eight years were to elapse before that prophecy
was fulfilled. But for Roberto Calvi the long defensive battle was
already under way.
*Scalfari and Turani:
Razza Padrona,
Feltrinelli, Milan, 1974.
Despite the fading
pink paint on the cosy eighteenth-century
facade overlooking Largo Bellotti, Banco Ambrosiano's headquarters just behind La Scala had many of the qualities of a fortress.
Once inside, the visitor would find sombre windowless corridors
stretching before him. The senior directors' offices on the fourth floor
were only attainable after a special key on the third floor had
activated the lift to go higher. To Roberto Calvi, now Ambrosiano's
unchallenged but wary master, the fortress would have seemed under
special threat when he gazed out over the rooftops of Milan in those
closing months of 1974..
Not only were unknown assailants trying to undermine the bank,
but the political climate in Italy at large was changing to his disadvantage. The country was moving leftwards, a process reinforced by the
widespread indignation felt at the Sindona affair, and the evidence it
had afforded for the dubious overlap between high finance and low
Christian Democrat politics. The beneficiaries were the opposition
Communists, who were promising a wholesale cleansing of Italian
public life, and not least of the country's banking system, if they came
to power. And for a while it seemed as if they really might.
In the summer of 1974, as Sindona's improbable financial edifice
was coming apart, the Christian Democrats chose to ally themselves
with the Church against the pressures for modernization of Italian
society, in a referendum on divorce. The outcome was humiliating
defeat. In regional elections the following year, the Communists won
an unprecedented 36 per cent of the popular vote. If that trend
continued, they might even overtake the Christian Democrats to
become Italy's largest party at the general elections to be held by 1977
at the latest, but probably rather sooner. The fear must have been
deep in Calvi that Ambrosiano might be threatened not only by
financial takeover, but by political one as well. Accordingly, he
started to take precautions in both directions.
In each case, the mechanisms were to hand, ready for employment:
the network of foreign subsidiaries created by Ambrosiano between
1960 and 1973, and that adept of the black political arts, Licio Gelli.
As we have seen, the exact date of Calvi's meeting with the Venerable
Grandmaster of the P-2 is uncertain. What does seem certain is that
partnership in earnest began around 1975.
Already, however, Calvi was setting about his financial purpose.
He would buy control of his bank, and—with the assistance of the
Vatican—transfer that control abroad. The mystery at the heart of
the Banco Ambrosiano affair was beginning, in the shape of an
obscure company called Suprafin.
Suprafin had been established in Milan in November 1971 by two of
Calvi's most trusted associates: an accountant of Armenian extraction
named Vahan Pasargiklian, later to become managing director of
Banca Cattolica del Veneto, and Gennaro Zanfagna, a Milan lawyer.
Capitalized first at two million lire, then 500 million lire, and finally
one billion lire, Suprafin was controlled by a Luxembourg holding
company called Anli. Early on it appeared to be primarily just
another tool, along the lines of the inglorious Pacchetti, for the
manipulation of the Milan market by Calvi and the Bonomis. In
November 1972, the latter bought one third of its shares, to be
relinquished only in 1975, when the Bonomis severed their ties with
Calvi. From very early on Suprafin would deal in Ambrosiano shares,
to smooth out violent price fluctuations. But after the disgrace of
Sindona and the rumours about Calvi, the selling of Banco Ambrosiano turned in that summer of 1974 from a trickle into a flood.